Micron threatens new dumping case
By Jack Robertson (12/22/97)
WASHINGTON--Micron Technology Corp. is threatening to file a new DRAM dumping case against chip makers in South Korea, Taiwan and Japan.
In Boise, Idaho, a Micron spokeswoman confirmed reports by investment analysts that the firm "is seriously considering" filing its third memory chip dumping suit in five years. Analysts said Micron told them in a conference call last week that all other DRAM producers have been selling below cost and many are liquidating large inventories driving down global prices precipitously.
In a DRAM report issued last week, International Data Corp. of Framingham, Mass., said Micron was considering new dumping charges. "If Micron takes any legal action, we expect it will likely occur in the next month just before the Korean and Japanese suppliers close their fiscal books," IDC asserted.
Any Micron dumping suit potentially could cause a knee-jerk reaction in some industry quarters to drive up the current rock-bottom DRAM prices. However, IDC summed up what most analysts expect: after the initial impact, "market forces will begin to drive prices down again."
Sources said Micron wants to back up its earlier insistence that none of the $57 billion global bailout in Korea end up financing further chip maker DRAM expansions during the persistent massive market oversupply.
Semiconductor analyst A. A. La Fountain III of Dominick & Dominick in New York also believes Micron would like to force Taiwan DRAM producers to curtail large capacity expansions, which the U.S. firm charges are unwarranted in the global market.
IDC reiterated the suspicion of many observers that Taiwan memory fabs may try to ramp up to grab market share if the Japan and Korea curtail their DRAM capacity growth. A Micron dumping suit could possibly give the Taiwanese second thoughts on such expansion if they are losing money on DRAMs, some sources added.
Micron told the analysts that ironically each of the three targeted countries "would like us to file a dumping case against the others." All regions are suffering from the continued DRAM capacity buildup -- but no country is willing to cut back unless rival nations do as well.
Micron has an existing five-year old DRAM case still pending against two Korean rivals--Hyundai Electronics and LG Semicon. The Commerce Department is expected to make a preliminary ruling in March whether the two firms engaged in dumping during the 12-month period ending April 30, 1997.
Any new Micron DRAM suit would bring in Samsung Electronics Co., which was dropped from the 1992 case, as well as the Japanese and possibly Taiwan suppliers. It would also cover the period up to the end of this year when the most drastic price-cutting occurred.
Micron in March also filed an SRAM dumping suit against 20 Taiwan producers and foundries and the three top Korean chip firms. Micron, however, has been scaling back its own SRAM output. By contrast, the U.S. memory chip has shot up to become one of the largest global DRAM firms, and claims to be one of the firm producers making any profit. |
