Glowing AI processor chips and HBM modules with upward-trending price graphs and neural network patterns
The semiconductor market is facing significant challenges. US export controls are impacting trade, memory prices are soaring, and a fierce battle is emerging in the AI chip sector.
US Restrictions Hit South Korea’s Exports
South Korea’s chip exports to China fell sharply by 31.8% in February. This decline is largely due to stricter US controls, especially on HBM chips. South Korea’s overall chip exports also dropped by 3%. Falling memory prices and changing tech are adding to the problem.
Memory Prices Set to Rise Dramatically
Expect DRAM prices to jump by 63% and NAND Flash by 33% this year. This is driven by high demand for smartphones, PCs, AI, and more. A few big companies control the supply, keeping prices high. China’s YMTC will also raise prices, following Micron and Western Digital.
AI Chip Market: Google, Amazon, and Nvidia Compete
The AI chip market is heating up. Google is working with MediaTek to make cheaper chips for its AI centers. Amazon is cutting prices on its Trainium chips to compete with Nvidia. Both want to reduce their reliance on Nvidia. SK Hynix’s US sales have surged, thanks to HBM demand.
Inventory and Sales Reflect AI Demand
SK Hynix’s US sales rose by 172% in 2024. This is due to high demand for HBM chips. Their inventory of finished goods is down, showing these chips are selling fast.
Key Takeaways:
- US controls are hurting South Korea’s chip exports.
- Memory prices will likely rise significantly.
- The AI chip market is seeing increased competition.
- HBM chip demand is driving sales and inventory changes.