NAND and DRAM prices spike after Japanese earthquake

The spot prices of NAND and DRAM have seen sharp spikes as the industry assesses the full impact of the Japanese earthquake.

Prices on Taipei's DRAMeXchange rose between five and 10 per cent within a day of the earthquake, and prices could rise higher as the news from Japan worsens. The price rises, if short term, may not immediately be passed on to consumers but prices could remain high if the damage is worse than expected.

"What we're seeing now is a short term spike based on human emotion," Michael Yang, principal analyst at IHS iSuppli told V3.co.uk.

"In the longer term prices should continue along previous trends. However, we haven't heard a damage report from Toshiba as yet."

Japan accounts for over a third of global production of NAND, with Toshiba the biggest manufacturer. Luckily most of the country's manufacturing facilities are based in the south of the main Honshu island, relativity removed from the epicentre of the earthquake.

Sony has reported that seven of its manufacturing plants and its Sendai Technology Centre are currently out of action and Fujitsu, which has given 100m Yen to the earthquake relief fund, is reporting that six of its sites had suffered.

Not only were many manufacturing centres damaged directly by the earthquake and resulting tsunami, but the damage caused to the country's electricity generating output means months of power cuts and brownouts. Tokyo residents have already been warned that they face three hours of power cuts a day until at least April.

Japan's important role in the electronics industry could lead to other shortages. Japan supplies around 60 per cent of the world's semiconductor silicon, as well as much of the world's LCD screens. Right now, however, technology companies are simply counting the cost.

"Our infrastructure in Japan wasn't damaged, and most importantly of all, our people are safe," said HP chief executive Leo Apotheker.

"We'll have to see how the power situation develops but we'll do everything to ensure our staff and customers can get back on their feet."

HP has pledged to match every dollar contributed by its staff to the earthquake appeal.