Key Metrics and Supply Alert
By Staff -- Purchasing, 2/21/2002
- Expect SRAM tags to be soft through the year. Average price for an SRAM fell from $5.68 in first quarter 2001 to $2.74 in the fourth quarter. Falling prices and weak demand resulted in the SRAM market declining 41% in 2001 to $3.8 billion. SRAM tags should decline another 5-7% in 2002, unless demand increases dramatically.
- Processor maker AMD and foundry house UMC will own and operate a 300-mm wafer fabrication facility in Singapore that will produce semiconductors. The shift to 300-mm wafers will result in greater manufacturing efficiencies and improved yields and allow AMD to reduce prices for its processors. The facility is expected to go online in 2005.
- Intel has cut prices for some versions of its Pentium 4, Celeron and Xeon microprocessors. The company reduced the price of its 1.6 GHz Pentium 4 MPU by 18% to $133; the 1.7 GHz Pentium 4 drops 16% to $163; the 1. 8 GHz chip falls 14% to $194 and the 1.9 GHz MPU drops 12% to $241. Intel also cut prices on four versions of its Celeron by 7-14% and its Xeon processors for servers and workstations by 7-9%.
- Keep a close eye on merger talks involving DRAM maker Hynix. If Hynix merges with another DRAM manufacturer it could have a far-reaching impact on DRAM supply and would raise the possibility of higher tags in fourth quarter. Hynix has been negotiating with Micron and Infineon.
- Now is a good time to negotiate long-term contracts for standard logic. Prices fell dramatically last year and have bottomed out. The average price fell from 17.4 cents in first quarter 2001 to 12.4 cents at the end of December, according to the Semiconductor Industry Association. Tags should remain low though, because supply will remain plentiful even if demand picks up in the second half. The standard logic market fell 46% last year to just $1.6 billion.
- The connector industry suffered its worst decline in history in 2001 as sales dropped 19.1%. Connector sales totaled $25.6 billion in 2001 compared to $31.6 billion in 2000, according to industry researcher Bishop and Associates. However the industry is expected to recover in 2002, showing sales growth of 5.5%. Over the next five years, connector industry sales will have a compound annual growth rate of 8.5%, according to Bishop.
| Indicator | Period | Latest Period | Previous Period | Year Ago | % Chg/Yr Ago |
| Real GDP (B'96$,SAAR) | Q4 Prelim | 9315.6 | 9310.4 | 9303.9 | 0.1 |
| Consumer spend, dur gds | Q4 Prelim | 1019.8 | 940.2 | 899.4 | 13.4 |
| Bus investment, equip | Q4 Prelim | 1005.9 | 1019.4 | 1099.3 | -8.5 |
| PC board book-to-bill (ratio) | Dec | 0.94 | 0.87 | 0.92 | - |
| Semi equip book-to-bill (ratio) | Dec | 0.78 | 0.73 | 0.99 | - |
| High-tech IP* ( '92=100) | Dec | 1002.3 | 999.7 | 1193.6 | -16.0 |
| Emp cost index (6/'89=100) | Q4 | 156.8 | 155.6 | 150.6 | 4.1 |
| Dur gds orders ($B, SA) | Dec | 176.4 | 173.1 | 215.3 | -18.0 |
| Consumer conf ('85=100) | Jan | 97.3 | 94.6 | 115.7 | -15.9 |
| * Industrial production of computers + communication equipment + semiconductors. | |||||
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