Fire at Hynix kills drops world RAM production.

Fire at Hynix drops world RAM supplies by 15 percent - prices set to soar.

World DRAM prices are set to rocket as news comes in that Hynix FABs 1 and 2 have been engulfed in a ball of flame following a huge chemical explosion.

Memory suppliers stop shipments:

Following the huge chemical explosions that took out 15% of the world’s memory production a short while ago, KitGuru has now been in contact with several major memory companies and we have been told “Everything is on hold”.
 
OCUK say their suppliers have already put up prices 20%:

An update from our own people out in Taiwan:-



As I have mentioned last night about the incident happen at Hynix factory in China. Today we have a little bit more update for you.

The full damage report is not yet being finalized, but the information we have got so far is maybe 80% of the factory is damaged. This facility is monthly production is about 30,000pcs of 12” Wafer, and 80% of them is for DRAM, and 20% of them is for flash.

However, this facility is responsible for about 15% of total DRAM production, therefore, we should be expecting the DRAM price going up significantly. Today the DRAMexchange showed that 256*8 IC price is up more than 15% this morning, so don’t be surprised when you get the new quote from us.

As we all know due to the low demand in August, everyone is trying to get their stock as low as possible, but we believe due to this incident that we may see some panic in the market of trying to get hold of stock. Since the damage is not yet finalized, it would not be possible for getting anything out there, but I will keep you updated. GeIL will do our best to serve you when the situation is more clear.

Just for your information, to rebuild such facility may take up to 1 year, and I bet other manufactures would start to increase their DRAM production as much as they can. Usually, new production will take 40-45 days to come out, so within this period the DRAM price would be flying and we shall not be surprised.

If you have any question, please let me know. We will keep you update for further information as soon as we got new update.



So Hynix say they are not hugely effected and should be able to resume soon, maybe trying to prevent their share price from crashing on the market as everyone else is saying its far worse.

Either scare mongering or Hynix trying to cover up the real damage.

Either way, DRAM prices have increased 20% overnight, glad I did all my ordering first thing yesterday morning when our contacts in Taiwan told us the building was on fire.

Unfortunately we don't stock up on graphics due to how expensive they are, so if graphics pricing increases then unfortunately the prices shall go up pretty quick and people will still buy them because simply sales don't stop when prices move.
And later:

A further update:-

1) all suppliers would not accept any orders before having updates on the pricing next week. But the price would be much higher till then.
frown.gif

2) being the biggest customer to Hynix, HP switched all orders to Kingston. This caused the shortage to worldwide instantly.


So massive panic right now and the prices are rocketing like crazy, if this calms down next week they will settle but unfortunately at new highs. If the problem is as bad as some of making out then pricing could get truly crazy.......

I'm glad I built my new rig a few months back with 16GB...
 
A more calm analysis.

Basically if you want ram buy now or wait a couple months, the price increase is not going to last long.
Don't be scared into buying ram now unless you need it.

But there’s just one problem: None of the wild speculation about the Hynix blaze was actually true.

While the plumes of smoke billowing from the building indeed appeared scary, Hynix representatives told PCWorld that the fire raged a mere 90 minutes and didn’t materially damage the factory’s clean-room fabrication equipment. The smoke appeared worse than it was because as the fire mainly occurred in air-purification area, Hynix said.

“We expect to resume operations in a short time period so that overall production and supply volume would not be materially affected,” the representative said.

Rumors of Hynix arch-nemesis Micron shutting down RAM sales were also squashed in short order, as the company told The Register that the report was flat-out incorrect.

"Our global supply chain constantly monitors trends. TT-IMS customers not expected to be affected by the Hynix fire." http://t.co/AtPhVrfJhf — TT electronics-IMS (@TTIntegrated) September 5, 2013

The damage certainly could have been severe: Hynix pumps out about 30 percent of the world’s memory chips, and the inflamed factory is responsible for around half that load—roughly 15 percent of the worldwide total.

So ignore the claims of quick-trigger analysts claiming the RAMpocalypse is a-comin’. Assuming that Hynix indeed gets its fab up and running in short order, any RAM shortages should be minimal and of extremely short duration.
 
It's good that Hynix isn't be set back too much by this. They've been doing really well lately, if I remember correctly.
 
But there’s just one problem: None of the wild speculation about the Hynix blaze was actually true.
OCUK say their suppliers have already put up prices 20%:

So basically OCUK needs to change suppliers because their current ones are just a bunch of opportunist scumbags
"We've heard there's problems at hynix, lets bump up the price by 20%, because we can get away with doing so"
 
So basically OCUK needs to change suppliers because their current ones are just a bunch of opportunist scumbags
"We've heard there's problems at hynix, lets bump up the price by 20%, because we can get away with doing so"

They've all done it, especially if you buy directly. I suspect it's just bit of panic an opportunism, and it'll all settle down in a few weeks when the truth comes out.
 
They've all done it, especially if you buy directly. I suspect it's just bit of panic an opportunism, and it'll all settle down in a few weeks when the truth comes out.
Basically this, many people looking to exploit the uncertainty of the situation to charge you extra.

<blockquote class="twitter-tweet"><p>Planned to buy some new VGA or RAM
 
Last edited by a moderator:
How long did it take for mechanical hard drive prices to drop back to somewhat normal levels?

It was around 1 year when they hit tolerable levels, but it was over 1.5 years to hit the same price levels as before the big flood on the larger 2TB models.
 
How long did it take for mechanical hard drive prices to drop back to somewhat normal levels?
This situation is much, much less damaging.
We should have a more complete analysis of the situation within the next week.
 
And Samsung have largely enough production facility to counter it by expand his own production.. ( sad thing to say, but samsung is surely happy ).

Knowning Samsung, they could even rent some lines to Hinyx, the same way they have do it by open their facility to Japanese panel production after Fukushima.
 
But Hynix say they didn't lose any production facilities, just a bit of aircon equipment on the roof of the building.

The fire was in the air purification unit which is essential to the working of the clean rooms. That also means there's a good chance that the air ducts and clean rooms suffered from smoke damage to one degree or another. Something that has to be cleaned up before clean room operation can begin. While that doesn't represent "material damage" to the clean rooms, it is still something that will take some time to get sorted.

If they are quick and can get the air purification unit repaired or replaced quickly then this could only mean the affected clean rooms are only out of operation for maybe 2-3 weeks (a short time).

This will affect spot market prices but is unlikely to affect contracted prices. Of course that means if a contract partner ends up needing more memory chips than contracted for, it could affect them as they'd have to hit the spot market. This of course, also depends on what pricing structure is built into the long term contracts.

Regards,
SB
 
I'm not versed in the physical plant setup of a fab, but wouldn't it be possible to automatically monitor the output of the air purification plant and shut things down before it filled the clean rooms with smoke?

I'm curious if an explosion that close to the fab equipment could trip vibration sensors and force them off automatically as well. The smoke or shock of the explosion could have ruined some of the wafers that were actively being processed at that point in time, though that's probably not what Hynix would consider a material impact.
 
Hmmm, that's true, depending on what safeguards they had, it might be possible.

I may or may not be looking too closely at their wording, the bolded part.

While the plumes of smoke billowing from the building indeed appeared scary, Hynix representatives told PCWorld that the fire raged a mere 90 minutes and didn’t materially damage the factory’s clean-room fabrication equipment.

It would have been easy enough to just say that the clean room wasn't materially damaged, but they only stated that the fabrication equipment wasn't materially damaged. IMO, allaying fears that the machinery had been damaged by the fire. But not saying much about the condition of the clean room itself.

When looking at PR damage control, what they don't say is often as important as what they do say.

Regards,
SB
 
I'm not versed in the physical plant setup of a fab, but wouldn't it be possible to automatically monitor the output of the air purification plant and shut things down before it filled the clean rooms with smoke?

I'm curious if an explosion that close to the fab equipment could trip vibration sensors and force them off automatically as well. The smoke or shock of the explosion could have ruined some of the wafers that were actively being processed at that point in time, though that's probably not what Hynix would consider a material impact.

Seriously, without having a complete reports in hand, this will be impossible to tell, this or this could or could have not happend..
 
I'm not versed in the physical plant setup of a fab, but wouldn't it be possible to automatically monitor the output of the air purification plant and shut things down before it filled the clean rooms with smoke?

I'm curious if an explosion that close to the fab equipment could trip vibration sensors and force them off automatically as well. The smoke or shock of the explosion could have ruined some of the wafers that were actively being processed at that point in time, though that's probably not what Hynix would consider a material impact.

Generally, aircon is above clean room space or off to the side. Give the dynamics of fire born smoke, if it was in the aircon system, it is likely that the system rapidly shut down putting minimal amount of particulates into the clean room. Once they get the aircon back up and running, they will likely just be running the aircon/filtration system for a while which will clean out any particulates in the clean rooms since that's their normal job anyways.

The most likely effect is increased fault rate for a bit once the fab gets back up and running. Now if foam or water got into the clean rooms via the air vents, it will obviously take longer.
 
Back
Top