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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Proud_Infidel who wrote (37453)	9/26/2000 9:38:13 AM
From: Proud_Infidel	Read Replies (1) \| Respond to of 70976

Contract Prices for 64Mb DRAM Microchips Set to Recover September 26, 2000 (TAIPEI) -- Nanya Technology Corp., Winbond Electronics Corp., Powerchip Semiconductor Corp. and Promos Technologies Inc. reported contract prices for 64Mb DRAMs of around US$7.50 a unit for October, down 7 percent from September. Also, the decline is much smaller than the corresponding fall in the spot price for DRAMs, now standing at US$6.80. Based on a possible weekly adjustment beginning from the fourth quarter, the contract price for 64Mb DRAMs is likely to increase to US$8 a unit in mid-October. Nanya has reached an agreement with its client and technology source IBM Corp. on the October DRAM contract price. The slight fall in the price will likely be reversed soon, as Nanya has asked for weekly price negotiations with IBM. It believes that the industry will have good prospects in the fourth quarter. The company said that the price of 64Mb DRAMs should rise to at least US$7.50 during this period. Also, Winbond and Powerchip are understood to have been conducting negotiations on the October contract price with their clients. Winbond is expected to insist on offering a higher price than its rivals, holding its contract price almost unchanged. Powerchip's contract price offering to Mitsubishi Electric is widely expected to be between US$7.30 and US$7.50 a unit. American IC Exchange (AICE) reported that the spot price of 64Mb DRAMs (8M x 8) reached a recent daily low of US$6.40 on Sept. 21, and the distributors' price offering also ended at a 13-week low of US$6.20. Despite this, local makers continue to claim there are clear signs that the spot price of 64Mb DRAMs is bottoming out, and they are confident that it will begin to rise. The expected less-than-7-percent fall in the October contract price indicates that local DRAM makers are reluctant to slash the price, although the spot price of 64Mb DRAMs has dropped 25 percent in the past two months. Demand for PCs is widely expected to rise in the fourth quarter, and this is likely to raise demand for DRAMs. The accelerating slide in the spot price of 64Mb DRAMs in mid-September delayed price negotiations for October's contract price until encouraging news broke. Several DRAM powerhouses, including Korea-based Hyundai Electronics Industries Co., Ltd. and Micron Technology Inc., claimed that they had received big orders, and the news put a halt on the DRAM price tumble. Powerchip and Nanya are set to deliver supplies of 64Mb DRAMs made using the 0.18-micron and 0.175-micron processes in October, at a monthly target of more than 10 million units. If the two local DRAM companies manage to hold their manufacturing costs at US$3 per unit, and if they get a DRAM contract price of US$7.50, their fourth quarter sales and profits are expected to rise sharply. Related stories: DRAM Spot Prices for Big Users Decline in U.S. Price of 64Mb DRAM Chips Falls to US$6 (Commercial Times, Taiwan)