Fitch sees limited impact of coronavirus on memory chip market

Global rating agency Fitch Ratings Inc. said Tuesday the global memory chip market will suffer a limited risk of supply disruptions in the short term from the spreading coronavirus outbreak.

The memory semiconductor market is likely to continue to recover as weakening demand for memory chips used in smartphones and PCs will be offset by stronger demand for those used in servers, Fitch said in a statement. 

On Friday, Shinsegae Department Store closed its Gangnam branch in Seoul, when one of the employees of its partner company was confirmed to be infected by the new coronavirus. (Yonhap)

"This is because the industry's manufacturing facilities are highly automated, and are less affected by labour shortages and travel restrictions compared with other technology hardware manufacturers," the statement said.

In addition, most companies stocked up enough materials before the Lunar New Year holiday to avoid shortages for the next few quarters, it said.  

However, a prolonged COVID-19 outbreak could affect the semiconductor industry's operating performance and derail its recovery, Fitch said. 

South Korea had reported 7,513 confirmed coronavirus cases and 54 deaths as of Tuesday. (Yonhap)