Memory prices may rise after Taiwan earthquake impacts chip production

Global memory prices may rise after a magnitude 6.2 earthquake struck early Sunday in Taiwan and impacted production at a Micron Technology facility responsible for nearly 10% of the world's memory supply.

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Micron operates a memory chip fabrication plant at Taoyuan, Taiwan that is responsible for roughly a third of Micron's total capacity to manufacture memory, or 8% of global memory, according to a research note from Evercore ISI analyst C.J. Muse. A "meaningful production hit" would likely lead to higher memory prices, Muse wrote.

In a statement to Bloomberg News, Micron acknowledged that there was an impact on production at the Taoyuan facility, and said the company was still ascertaining the impact on production.

Memory is a commodity business, and fluctuations in the available supply directly affect prices. Production problems that limit the supply of memory likely mean Micron will be able to fetch a higher price for the memory it does make.

Last year, the Micron plant at Taoyuan suffered a power outage that disrupted its memory production. The brief interruption in production triggered a rise in memory prices.