Semiconductor market on pace for 16% growth this year: report

The global semiconductor market, of which Korea’s Samsung Electronics and SK hynix currently account for roughly 70 percent, is continuing to expand amid strong international demand, with industry experts forecasting the market size to jump roughly 16 percent on-year in 2017, according to a report released by IC Insights on Thursday.

Following higher-than-expected chip sales trends, IC Insights’ 16 percent rise projection has more than tripled from its previous estimate of 5 percent earlier this year.

The projected increase would mark the first double-digit gain for the market since it expanded by 33 percent in 2010, the recession-recovery year, and the fifth double-digit increase since 2000, the report said.

The report also added that the total combined sales of DRAM chips and NAND flash memory for this year are expected to increase by 55 percent and 35 percent, respectively.

Along with the continued strong rise in demand in the semiconductor market, the global price for DRAM also rose 5.2 percent on-month last month, according to data from market intelligence agency DRAMeXchange on Thursday.

The average contract price for DDR4 4 GB 512Mx8 2133MHz reached $3.25, up from $3.09 in June. The price also marks a 67.5 percent jump from the $1.94 price tag at the end of last year.

Samsung continues to lead the market, posting an operating profit of 8.03 trillion won ($7.14 billion) in the second quarter of this year, up from 2.64 trillion won the previous year, while SK’s operating profit rose 573.7 percent on-year to hit 3.05 trillion won in the second quarter.

The Bank of Korea announced earlier this week that South Korea’s semiconductor exports also surged to record highs this second quarter.

The country’s semiconductor export volume index hit 393.97, roughly quadruple the 100 benchmark posted in 2010. The export volume also marked a 20.2 percent increase compared to the second quarter of last year, when it stood at 327.86, and a 2.7 percent jump compared to the first quarter of this year.

By Julie Jackson (juliejackson@heraldcorp.com)