China's Semiconductor Manufacturing International Corp. (SMIC) says it will stop producing DRAMs.

The foundry says it will convert its production lines form DRAM to logic chips used in mobile phones and digital cameras.

SMIC reported a bigger than expected loss this quarter, due in large part to a $44 million provision taken against its DRAM inventories, SMIC said in a statement on Tuesday. President and CEO Richard Chang said "SMIC and its clients have reached a consensus that we would completedly retreat from the DRAM market after the first quarter and converse the DRAM equipments for logic production."

The DRAM market has been suffering its worst downturn since 2001, with the average spot price of mainstream DRAMs falling nearly 60% in the past year amid a supply glut.

SMIC is China's biggest chip foundry by capacity.