Trendforce: Impact on Micron's production capacity limited
Power outage at Micron's Japanese plant, impact on production capacity limited, says TrendForce.
According to Trendforce investigations, this plant's monthly wafer starts accounts for approximately 30% of Micron's total monthly wafer starts in 3Q22. In terms of global wafers starts, this plant’s proportion of wafer starts is approximately 7%. The plant’s primary production process is 1Z nm, accounting for more than 50% of capacity, followed by 1Y nm, accounting for nearly 35%. Although machinery initiated the uninterruptible power supply system when the outage occurred, due to the voltage drop, plant machinery required initialization and inspection.
The power outage persisted for approximately 5~10 minutes and the effect on production capacity was limited.
This Micron plant is mainly a R&D center and the next-generation 1beta nm process will be prioritized for production at this location. Looking at its product categories, the plant primarily produces mobile DRAM related to smartphones at this stage. TrendForce also indicates, weak global consumer electronics demand due to geopolitical conflicts and rising inflation since the beginning of the year has precipitated a high level of memory inventory among various manufacturers. The impact of the power outage on Micron's production capacity is relatively low and Micron can also use its inventory to meet the needs clients, so there is no impact on the overall supply and demand in the DRAM market.
TrendForce has simultaneously observed that the spot market, which always responds immediately to market conditions, has not seen an increase in demand since the power outage nor is there a market response to customers' urgent orders. The power outage will not reverse the current oversupply of memory. TrendForce will maintain its original price forecast for 2H22, which means that DRAM prices will drop by approximately 10% in 3Q22.