01. U.S. Tightens Controls, South Korea's February Semiconductor Exports to China Plummet by 31.8%
South Korea's semiconductor exports to China plunged by 31.8% in February, a significant increase from the 22.5% decline in January, sparking concerns over a cooling global demand for semiconductors. According to a report by Bloomberg on the 17th, the United States' intensified restrictions on technology supply to China, especially the new export regulations on high-bandwidth memory (HBM) chips introduced in December last year, are the main reasons for the sharp drop in South Korea's chip exports to China. Data from South Korea's Ministry of Trade, Industry and Energy shows that South Korea's overall semiconductor exports decreased by 3% year-on-year in February. In addition to the impact of U.S. controls, the decline in memory prices and the transition in semiconductor manufacturing technology are also important reasons for the slowdown in exports.
02. Global Memory Semiconductor Prices to Surge by 33-63% This Year
On the 19th, IC Insights announced that DRAM prices will rise by 63% and NAND Flash prices by 33% this year compared to last year, both reaching historic highs. IHS Markit forecasts that the global semiconductor memory market will grow from $78.3 billion last year to $111.6 billion this year. Since the second half of last year, the prices of DRAM and NAND Flash have been on a continuous upward trend. Last year, the average selling price of DRAM soared by 130%, while NAND Flash increased by 50%.
Lee Seung-woo, a researcher at Hyundai Investment Securities, pointed out that the high-specification competition among smartphone and PC manufacturers, as well as the expansion of emerging markets such as artificial intelligence, the Internet of Things, and autonomous vehicles, have driven the growth in demand for semiconductor memory. However, a few companies, including Samsung Electronics, SK Hynix, and Micron, control the market supply, leading to persistently high prices. Nevertheless, as semiconductor companies increase their investment in NAND Flash equipment, a decline in prices is inevitable in the long run.
03. China's Leading Memory Chip Maker Yangtze Memory Technologies to Raise Prices in Sync with Micron and Western Digital
According to a news on the 19th, China's Yangtze Memory Technologies Co., Ltd. (YMTC), along with major memory chip manufacturers such as Micron and Western Digital, are expected to raise prices next month. The reasons are industry production cuts and the strong demand for memory chips from the artificial intelligence market. It is reported that YMTC's brand, Zhitai, has notified dealers that its solid-state drives (SSDs) and memory card prices will increase by at least 10% starting in April. Previously, Western Digital announced a price increase of over 10% starting April 1st, with Micron, Samsung Electronics, and SK Hynix also following suit.
Micron, Samsung, and SK Hynix had already resumed cutting memory chip production at the end of 2024 to curb the decline in NAND flash prices. In addition, the recovery of market demand in China and the rapid popularization of artificial intelligence applications have also driven up memory chip prices.
04. SK Hynix's U.S. Sales Ratio Surpasses 60% for the First Time, Driven by HBM Demand
According to "Everyday Economic News" on March 20th, SK Hynix's sales to the U.S. surged by 172% year-on-year in 2024, with the proportion exceeding 60% for the first time. This growth was mainly due to the significant increase in exports of high-bandwidth memory (HBM) and other artificial intelligence semiconductors.
Analyses show that SK Hynix's inventory assets decreased from 13.4807 trillion won in 2023 to 13.3139 trillion won, with the proportion of total assets dropping from 13.4% to 11.1%. Among them, raw materials and work-in-progress increased by 13.98%, while products ready for shipment, such as DRAM and NAND, decreased by 30.13%. This indicates that with the growing demand for HBM, finished goods inventory is being rapidly depleted.
In the Chinese market, SK Hynix's sales increased by 53.7%, but its proportion dropped from 30.8% to 23.5%. Sales in other Asian markets and the European market increased by 25.2% and 51.2% respectively, but their proportions also declined. SK Hynix stated that the significant increase in U.S. demand for HBM is the main reason for the export growth.
05. Google to Collaborate with Taiwan's MediaTek to Produce Next-Generation Semiconductors
On March 17th, according to reports from The Information, Google plans to collaborate with Taiwan-based semiconductor design company MediaTek to jointly develop the next-generation Tensor Processing Units (TPUs), with production expected to commence in 2026. This partnership aims to produce lower-cost chips for Google's AI data centers, reducing its reliance on Nvidia. One of the reasons Google chose MediaTek is its close relationship with TSMC, the world's largest semiconductor contract manufacturer, and its more competitive chip pricing compared to Broadcom. Despite a nine-year exclusive partnership with Broadcom, Google has sought alternatives due to pricing disagreements on TPUs. In the new collaboration, Google will lead most of the design work, while MediaTek will primarily focus on developing the input/output modules.
06. Amazon Reportedly Cuts Trainium Chip AI Server Prices to Compete with Nvidia
According to a March 19th report from The Information cited by the Economic Daily, Amazon Web Services (AWS) is reducing prices for its Trainium AI chip servers to attract customers away from Nvidia's high-cost solutions. AWS claims that the computational power of Trainium chip servers is comparable to that of Nvidia's H100 chips, but at a quarter of the cost. Meanwhile, tech giants like Google and Microsoft are also ramping up their own AI chip development efforts to reduce dependence on Nvidia. However, AWS faces the challenge of providing a smooth transition for developers who rely on Nvidia's software ecosystem. In December 2024, AWS executives stated that companies such as Apple, Adobe, and Anthropic were testing Trainium chips with positive results. Additionally, Amazon launched its most powerful in-house chip, Trainium3, in December 2024, with an expected release by the end of 2025.