IC Insights has increased its forecast for the chip market in 2021 to +24 percent, topping $500bn for the first time.
The report looks at 33 major product types, 32 of which are expected to register growth this year.
The highest growth will be seen in industrial digital chips with a growth of 47 percent, which did not feature in the top ten predicted at the beginning of the year. This was followed by the traditional market driver of DRAM memory. Automotive and consumer logic chips are also driving growth in the market through increased shipments.
Continued higher per-bit prices for DRAM and NAND flash memories with better than expected growth in many of the logic and analogue chip categories were the driving forces behind IC Insights’ full-year 2021 IC market forecast being raised from 19 percent to 24 percent. Even if excluding memory, the total IC market is expected to be up by 21 percent this year.
This is driving the current shortages as capacity was not in place to meet this level of demand.
After dropping 8 percent in 2019, the analogue IC market registered a small 3 percent increase in 2020 but the market is expected to surge by 25 percent with a 20 percent jump in unit shipments. The capacity constraints are also driving up average prices by 4 percent for analogue parts, and the last time there was an increase in analogue IC ASP was 17 years ago in 2004 when the average price was 60c.
The ASP for logic ICs is forecast to drop 5 percent this year but be offset by a massive 30 percent increase in logic unit shipments.
With the price per bit of DRAM rising 28 percent from 39 cents per Gb in 4Q20 to 50 cents per Gb in 2Q21, IC Insights raised its full year 2021 forecast for the DRAM market to 41 percent. It expects the price per bit of DRAM will continue to rise in the second half of this year as supply remains tight.
The forecast for the NAND flash market is for 22 percent growth. The price per bit of NAND declined 26% from 1Q20 to 1Q21, but pricing stabilized in 2Q21 and is expected to increase over the remaining two quarters of this year. For all of 2021, the total memory market is forecast to be up by 32 percent.
This growth rate of 24 percent would be the third largest increase in the global IC market over the past 16 years, being surpassed only by the 33 percent surge displayed in 2010 and 25 percent in 2017.
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