Do not Panic about RAM

As you no doubt heard, on the 4th of September, 2013 there was a fire in a large Hynix DRAM fabrication plant in Wuxi, China. The Internet was flooded with doomsayers proclaiming a drop in supply that would surpass the great hard drive shortage of 2012. However, it is never quite that simple.

UPDATE – September 13th 3:00 EST
As we monitor the situation, it has become clear that the price increases that first touched the consumer market are reaching the manufacturing supply chain. There are no clear indications of a shortage at this time, but we can confirm an across the board price increase in RAM in response to the situation. We will continue to work closely with RAM suppliers to monitor this situation as best we can, and continue to recommend not panicking.

What going on:

The facility in question produces about 15% of the world’s DRAM.

  • Operation was temporarily suspended.
  • A Hynix spokesperson says that the supply volume would not be materially affected.
  • Little to no damage has been reportedly done to the fabrication facilities in which the RAM is made.
  • The fire is reported to be the result of equipment installation.
  • It burned for about 90 Minutes.
  • One person was injured.

What it means:

It’s important to note the differences between the appearance of a shortage and an actual shortage. Fear of a shortage will drive the consumer to buy and that affects the price. As the rumor mill started to spin, the price of RAM has ticked up… Despite a lack of solid evidence to support a shortage.

What next:

We, like the rest of the industry, are watching the situation closely. Hynix is a well known commodity and when they say the supply chain will not be affected, it should come with some weight. That said, we will be keeping an eye on things as they progress. Stay tuned for more information.

Further information: