Japan chip gear orders stay weak in July

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TOKYO, Aug 19 (Reuters) - Orders for Japanese equipment used to make semiconductors fell 27.8 percent in July from the same month last year as chip makers reined in spending, calculations based on industry data showed on Tuesday.

It was the 17th straight month of year-on-year declines amid a glut of memory chip supply, and the Semiconductor Equipment Association of Japan said it didn't expect the situation to improve for equipment makers in 2008.

Orders in July came to 93.90 billion yen ($856 million), down 0.2 percent from June, based on monthly order values taken from the industry group's preliminary report.

"The outlook has not improved, and with device makers such as Elpida Memory Inc , Toshiba Corp and Samsung Electronics Co delaying spending, I can't foresee a recovery by year-end," said SEAJ spokesman Masamichi Kobayashi.

The association said the book-to-bill ratio came to 1.09 in July, marking the first time in 13 months that orders outpaced sales, due largely to a sharp fall in sales. The ratio means new orders worth 109 yen were received for every 100 yen of products delivered in May to July.

Based on the preliminary report, which gives three-month moving averages of orders and sales, sales in July came to 69.9 billion yen, down 57.3 percent from the same month a year ago and down 31.1 percent from the previous month.

Japan is home to semiconductor gear makers such as Tokyo Electron Ltd , Advantest Corp, Disco Corp , Yokogawa Electric Corp and Nikon Corp . (Reporting by Mayumi Negishi; Editing by Hugh Lawson)