RAM price relief? SK Hynix plans $13-billion Korean fab

SK Hynix said on Wednesday that it plans to invest the equivalent of US$12.85-billion (R212-billion) in a new manufacturing plant in South Korea for advanced packaging, to meet rising global demand for AI memory, with construction starting this month.

The Nvidia supplier, one of the world’s largest memory chip makers, has been expanding production capacity to keep up with strong demand for artificial intelligence data centres.

It said in a statement that the new fab plant will be dedicated to advanced packaging, a process essential for manufacturing AI memory products such as high-bandwidth memory (HBM) chips.

Earlier this year, SK Hynix said it has accelerated capacity expansion, including bringing forward the opening of a new memory chip plant in South Korea, as it seeks to meet surging demand.

The announcement comes amid what the industry has dubbed a “memory supercycle” – a sustained surge in demand for DRAM and NAND that has driven prices to record highs and left enterprise buyers scrambling for supply.

DRAM contract prices surged 55-60% quarter on quarter in the first quarter of 2026, according to Taipei-based research firm TrendForce, with server DRAM up more than 60%. NAND flash prices rose 33-38% over the same period. Counterpoint Research has projected that DDR5 64GB RDIMM modules, widely used in enterprise data centres, could cost twice as much by the end of 2026 as they did in early 2025.

Root cause

The root cause is AI. Memory manufacturers have aggressively reallocated capacity to high-bandwidth memory used in AI accelerators, where margins significantly exceed those on conventional DRAM. Each Nvidia H200 GPU requires eight HBM3E modules, and the newer B300 consumes even more DRAM, using taller, 12-high stacks.

SK Hynix said during its October earnings call that its HBM, DRAM and NAND capacity for 2026 was essentially sold out, while Micron has exited the consumer memory market entirely to focus on enterprise and AI customers. Samsung hiked its 32GB DDR5 module price from $149 to $239 in September alone – a 60% increase – while contract prices for DDR5 more than doubled, Network World reported, citing Counterpoint Research.

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The pain is being felt well beyond the memory vendors themselves. HP has warned Bloomberg that full-year earnings will come in at the lower end of forecasts due to rising memory costs, and Cisco suffered its worst trading day in more than three years after warning investors that memory prices would squeeze margins.

SK Hynix has predicted that the shortage will persist until late 2027 – meaning that even with Wednesday’s investment announcement, meaningful relief for enterprise and consumer buyers remains well over a year away.  — (c) 2026 NewsCentral Media, with additional reporting (c) 2026 Reuters