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To: Cynic 2005 who wrote (63186)	9/21/1999 9:27:00 AM
From: hunchback	Respond to of 86076

Taiwan Quake Seen Pushing Up Chip Prices By Yoo Choon-sik SEOUL (Reuters) - The massive earthquake that rocked Taiwan overnight was expected to push world chip prices higher, at least in the short term, analysts in Seoul said Tuesday. They generally shrugged off statements by Taiwan's major chipmakers, Taiwan Semiconductor Manufacturing Co and United Microelectronics Corp, that the quake had caused electricity outages but no damage to their production lines. ``The exact damage there has not yet been disclosed but chip production lines are very sensitive to tremors and I think this will lead to another rise in chip prices,' said Jon Chong-hwa, an analyst at Salomon Smith Barney KEB Securities. Jon said the world spot price for the current mainstay 64-megabit dynamic random access memory (DRAM) chips could rise above $15, this year's highest level so far. The earthquake, measuring 7.6 on the open-ended Richter scale, struck the island state before dawn Tuesday, and killed more than 1,000 people. ``An electricity outage and a water supply problem are very important to the chipmaking industry and I don't think they can recover from the damage in the short term,' said Suh Do-won, an analyst at LG Securities. South Korean chipmakers, leaders in the world memory chip industry, saw their share prices soar Tuesday as the disaster was expected to result in a sharp rebound in the chip price. Samsung Electronics Co ended up 8.6 percent at 240,000 won, Hyundai Electronics Industries Co up 13.1 percent at 39,800 won and Hyundai Microelectronics Co up 12.9 percent at 28,000 won. Brokers on the Korean stock market attributed the lack of strong follow-through buying in Samsung to concerns that the stock had already gained 184.4 percent this year, compared with the overall Korean share market's 66.0 percent rise. The two Hyundai Group firms were in the spotlight because they compete strongly with Taiwan makers in the world spot market. Samsung sells less than five percent of its DRAM output on the spot market while Hyundai firms as a whole sell some 20 percent of their output, analysts said. The three South Korean makers accounted for 35 percent of world DRAM sales in calendar 1998, with Samsung alone taking 18.8 percent of the world DRAM sales. Taiwan firms account for about five percent in the world DRAM market but their share should rise to 12 percent when taking into account the outsourcing for Japanese and other makers, analysts said. The world 64-megabit DRAM price is declining moderately these days after hitting the year's highest level of $15 and is trading at around $12 per unit, they said. The recent price upsurge, which analysts attributed to strong personal computer sales tied to free PC offers, had beaten expectations. The price stood at about $4 in May-June. dailynews.yahoo.com