As if the earthquake and tsunami that hit Japan on Friday weren’t enough, its present nuclear problems and resultant lack of energy panicked financial markets and sent companies all over the world scrambling to find alternate sources of supply for everything from auto manufacturing to shipbuilding to high-tech components.
According to Reuters, spreading radiation from the Fukushima Daiichi power plant in the northeast of Japan has not only threatened Tokyo, but has also resulted in a shutdown of a major source of Japan’s power, crippling its manufacturing and commercial operations. Ports have also been affected, damaged in the quake, and the lack of power has caused problems with other transporation.
The ripple effect is hitting companies downstream from Japan’s factories, as prices for everything from semiconductors and memory chips to automobiles. Even as shares of Tokyo Electric Power Co. (TEPCO), Asia’s biggest utility and the operator of Fukushima, saw its shares plummet on a flood of sell orders (despite almost nonexistent trading, the company lost 42% of its value since Friday), other prices have risen. NAND flash memory chips saw their spot price jump 20% on Monday; DRAM memory chips were up 7%.
Japan produces almost 40% of flash memory chips for such tech devices as computers, smartphones and tablets, and about 20% of the world’s semiconductors.