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Analysis |

Consumer DRAM price decline expands to 13~18%

According to TrendForce investigations into the DRAM market, under pressure from ever-increasing output, Korean manufacturers have significantly increased their willingness to compromise on pricing in order to stimulate buying from distributors and customers, leading to a steady expansion of falling prices.

In addition to Korean manufacturers enthusiastically slashing prices, low-priced chips from the spot market are also circulating in the market. Other suppliers have no choice but to follow suit and fervently reduce pricing for sales, rapidly exacerbating the 3Q consumer DRAM price drop from the original estimate of 8~13% to a quarterly decline of 13-18%.

Looking forward to Q4, it will be difficult for stocking momentum to recover before terminal inventories have been completely depleted. TrendForce expects the price of consumer DRAM to continue to fall until oversupply in the market is alleviated. Thus, consumer DRAM pricing will carry on moving lower by another 3~8% in Q4 and the possibility of sustained decline cannot be ruled out.

Previously ascendant, DDR3 has a long way to fall; DDR4 also maintains downward trend amid factories’ strategic shift

In terms of DDR3, pricing reached a high watermark last year due to aggressive pricing strategies adopted by Korean manufacturers. Taking DDR3 4Gb as an example, this product sold at an approximate 60% premium compared to its historic low. Looking at terminal applications, a customer chooses to install DDR4 in a new project. In addition to cost considerations, the size of Taiwanese manufacturers’ DDR3 particles is also a key factor. Enlarged particles will be compressed into the available space of other components. Based on the aforementioned considerations, the progress of customers’ switch to DDR4 is more optimistic than expected. Therefore, as the scale of the DDR3 market has obviously contracted, there will be a lot of room for further decline in the future. Although the current price of DDR4 is relatively low, its process is more advanced than that of DDR3 and the three major manufacturers still have plans to continue the migration to new processes. The cost will be effectively reduced, so pricing trends are expected to continue downward.

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July 23 2024 1:29 am V22.5.13-1