© dmitry bomshtein dreamstime.com Analysis | March 26, 2019
TrendForce: DRAM ASP poised to continue descent
DRAMeXchange, a division of TrendForce, points out that the drop in DRAM contract prices continues to grow in the first quarter due to the overabundance in inventory levels, falling by over 20% in overall ASP.
The accelerating drop in prices did not stimulate a recovery in demand, and transactions have still been few. DRAM ASP is predicted to continue falling well into the third quarter as inventories clearouts have yet to be completed. According to research by DRAMeXchange, inventory levels accumulated by DRAM suppliers (including wafer banks) have generally come to over 6-weeks' worth at the end of the first season. Although inventory levels may vary among buyers due to different product categories, they stand at up to 5 weeks on average at the very least. Server and PC customers even possess inventory levels over 7 weeks' worth. Supply bit will continue to grow as the second season begins, thanks to contributions from the 1Ynm process. With an aim to greatly reduce inventory levels, DRAM suppliers in general will continue to adopt large price-lowerings in order to stimulate sales. Prices drops will be greatest in PCs and server DRAMs just like the first season, coming to a decline of 20%, while mobile DRAMs will drop by a smaller 10~15% due to the pull created by customers as they buy new phones. DRAM ASP is predicted to continue descending by 20% in the second season. As for whether price drops may successfully shrink in the second half of this year, it depends on demand recovery and the extent to which inventories clear out in the second quarter. A DRAMeXchange analysis predicts that end demand recovery will be the key factor determining whether DRAM sales hit rock bottom, since average DRAM content-per-box in 2019 will perform worse than last year across all product categories. But simply judging from the supply-demand prediction that oversupply will be far less serious in 2H than in 1H, price drops may be expected to undergo gradual contractions in the third and fourth seasons. Declines Show No Signs of Shrinking for PC and Server DRAM, While Slowing for Mobile DRAM Looking at the price trends of various DRAM applications for this year, commodity DRAMs and server DRAMs exhibit the most salient drops since the fourth quarter last year due to higher inventory levels. PC demand was quite sluggish in the first half-year owing to the lack of shipment growth and the yet-to-be-alleviated Intel CPU shortage in mid-range and low-end devices. Mainstream 8GB commodity DRAM module solutions, for example, have fallen by 30% in price in the first quarter, with the bottom price lying around 40 USD. ASP will proceed to move towards 35 USD in the second season looking forward, and may even hit the 30 USD threshold by year-end. After going through a two-year streak of high demand, server stock ups are starting to show significant signs of failure thanks to the rather high inventory levels in 1Q and the arrival of the traditional offseason for OEMs. Though a few North American datacenters have begun to place orders in March, the number of overall purchases has yet to see a clear revival. Furthermore, current inventory levels are high on both the supply and demand ends, and server DRAM prices are predicted keep on falling until inventory clears and demand recovers. DRAMeXchange predicts that declines will remain around 20% in the second season, and persist into the third and fourth season at around 10%. For mobile DRAMs, total smartphone production has fallen by over 10% compared to last year in response to an unenthusiastic market. As a result, mobile DRAMs suppliers cannot effectively clear their inventories, causing prices to see new depths. Discrete and eMCP products have dropped by about 20% on average, resulting in no small commotion in market quotes. Contract prices are predicted to shrink compared to the first season, not only due to the increase in content-per-box initiated by the Android / iPhone duo, who are procuring parts for their new flagship devices, but also the transition from offseason to peak season, which will revitalize demand. However, considering that total smartphone production quantity will show negative growth this year, and the limited content-per-box growth in mid- range and low-end phones,contract prices still face an inevitable fall in the second and third season. Lastly, we look at specialty DRAM price trends. A few set-top boxes and internet connectivity tenders have popped up in China after the lunar year holidays, pulling production ever so slightly. But after this one-time tender event, overall demand slumped nevertheless . As DDR3 supply remains higher than demand, this year's specialty DRAM prices are predicted to keep falling by 15% and 10% in 2Q and 3Q respectively.
U.S. polysilicon makers laud Phase 1 of China deal The United States’ three remaining manufacturers of polysilicon expressed appreciation to President Trump and praised U.S. negotiators for securing the Chinese commitment to purchase U.S. polysilicon in the first phase of the U.S.-China trade deal.
Dupont explores divestiture of electronics unit Following its recent USD 26.2 billion deal to sell off its nutrition business, DuPont de Nemours Inc. is weighing a divestiture of its electronics unit, according to people familiar with the matter.
AMD bolsters exec leadership team AMD has announced several promotions and one new hire to its senior leadership team, in an effort to enable the company’s continued growth in the high-performance computing, graphics and visualization technologies market.
Webasto opens new battery centre in Jiaxing Webasto has inaugurated its new roof plant and battery center in Jiaxing (Zhejiang Province) close to Shanghai.
Sponsored content by CMLCML manufactures Insulated Metal Substrate (IMS) solutions Printed circuit boards (PCBs) plays an important role in our day to day life. Whether it’s the car you’re driving, the phone that you’re scrolling through or computers that you’re sending emails from. What happens when you use heat generating components on a PCB? That’s right, cooling is needed!
Panasonic to expand its manufacturing footprint in India Panasonic is looking to build a new wiring device factory in southern India. The new factory is scheduled to start production in autumn 2021, responding to the increased demand in the country.
Season Group strengthens wireless R&D & manufacturing capability Season Group has invested in, and installed, two high-speed and high-precision wireless communication testers - Rohde & Schwarz’s R&S CMW500 Wideband Radio Communication Tester and R&S CMW100 Communications Manufacturing Test Set.
Rocket Lab expands capabilities in So Cal Rocket Lab announced this week it will open a new facility to serve as its corporate headquarters and provide increased production capacity.
PCB Piezotronics unveils new clean rooms PCB Piezotronics Inc., a wholly owned subsidiary of MTS Systems Corporation, has announced the completion of environmentally controlled clean rooms at their DePew, New York facility.
European loudspeaker company brings production back home Difficulties manufacturing smaller design series among reasons for the decision to return back to base.
China only region to register pure-play foundry market growth Rise of China-based fabless IC suppliers offers increased opportunities for foundries, IC Insights states in a recent report.
Mycronic receives first SLX order Swedish production equipment specialist, Mycronic, has recieved their very first order of its mask writer SLX.
600 new German jobs as VARTA expands production again The lithium-ion battery market continues to experiencing growth, currently the market is poised to continue to move forward with an annual growth of about 30% – and VARTA wants a big piece of the pie.
FTG achieves S9100D certification at acquired PCB fab Firan Technology Group Corporation has completed and received AS9100D Certification from SAI Global Ltd. for its recently acquired PCB manufacturing facility located in Fredericksburg, Virginia USA (formerly Colonial Circuits Inc.).
Dutch block sale of technology, China miffed Following ASML’s denial of an export license by the Dutch government to sell a piece of critical chip-making technology to the Chinese, China’s ambassador to the Netherlands has issued a statement expressing his country’s displeasure.
DuPont aids S. Korea in photoresist shortage The office of Korea’s Ministry of Trade, Industry, Sung Yun-mo, met with DuPont President Jon Kemp last week to confirm DuPont’s investment in the country’s need for diversification of its EUV photoresist supply.
Volvo building U.S. battery assembly plant In preparation for bringing a new line of electric vehicles to the U.S. market, Volvo announced it will build a battery assembly plant at its existing facility in Ridgeville, South Carolina.
New game consoles expected to trigger demand surge for graphics DRAM and SSD's TrendForce expects the year-end release of new generation game consoles to trigger a demand surge of graphics DRAM and SSD's during the second half of 2020.
A new year begins with new machinery at Swedish Microwave In Motala, Sweden sits Europe’s oldest manufacturer of Low Noise Block down-converters (LNB) for the global satellite market, namely Swedish Microwave (SMW). The company is now kicking off 2020 with an investment in production.
Lucid eyeing April reveal of pre-production sedan Luxury EV manufacturer Lucid has announced that production is underway in Silicon Valley of 80 beta prototypes of its luxury sedan, Lucid Air, to be unveiled in April in New York City.
Ideal Industries moving the ball forward at Cree Following its March announcement that Cree had sold off the entirety of its lighting business to Ideal Industries in a USD 310 million deal, Ideal said it would remain dedicated to pumping investment dollars into the now privately-held Cree Lighting.
Former pSemi exec and CEO Jim Cable retires pSemi Corporation has announced the retirement of former CEO and long-term executive Jim Cable.
Rohde & Schwarz inks agreement to use Benchmark's muscles The German electronics group has signed a strategic agreement with US EMS provider, Benchmark Electronics, to enhance its manufacturing capacities.
Stoneridge appoints new VP of operations Stoneridge Inc. has announced Kevin Heigel as its new vice president of operations.
Gartner: Worldwide semiconductor revenue declined 11.9% in 2019 Intel reclaimed top spot in global semiconductor market; Samsung moved to no. 2.Load more news