LONDON — Bruce Diesen, analyst with Carnegie ASA (Oslo, Norway) has raised his forecast for the 2009 chip market. The market will still be down but the market shrink will be less than Carnegie previously predicted.

"We now expect a 12 percent drop in world semiconductor dollar sales this year versus the old estimate of minus 14 percent, and an 11 percent increase next year," said after figures for September were published by World Semiconductor Trade Statistics (WSTS). "Early indications are that memory chips will be strong again in October on higher prices," Diesen added.

Diesen revised his forecast from a 15 percent fall to 14 percent fall in September on the strength of the July figures reported by WSTS.

DRAM and automotive chip sales were stronger in September while PC processor and logic chips strengthened sharply compared with August, helped by a change in the mix towards more servers, Diesen said.

At the same time wired communication chips and chips for LCD TV weakened. Handset chip sales also weakened slightly in September with a shift towards simpler phones. NAND flash memory, used in MP3 players and smart phones, also weakened month-on-month on a seasonally adjusted basis despite sharply higher prices.