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Despite reduced wafer starts at DRAM manufacturing facilities, prices of dynamic random access memory continued to feel in the first half of December as the effects of the Thailand flood disaster on the HDD industry linger and the traditional slow season for PC shipments has arrived.

Average DDR3 4GB module price fell to $16.5, a decrease of approximately 6%, while average DDR3 2GB module price reached $9.25, a near 3% decrease, according to DRAMeXchange, a research division of TrendForce. DDR3 2Gb chip spot price is also nearing the financial crisis period low of $0.6.

From the market perspective, with the holidays around the corner, European and American clients are returning home mid-month; thus, contract price negotiations were concluded in the first half of December. The Asia market will continue to negotiate prices twice a month, but with significantly fewer concluded transactions compared to November, contract price is still on the downtrend.

The global DRAM industry was affected by the March 2011 earthquake in Japan, but DDR3 4GB price recovered to $36.5 in May. However, DDR3 4GB contract price has been on a downtrend since then, arriving at $16.5 in December, a 55% decrease. As a result, many DRAM makers are cutting capacity or transitioning to foundry business.

According to TrendForce statistics, global DRAM wafer start volume has fallen from the high of 1.5 million starts per month in 2008 to a forecasted low of 1.0 million starts per month in 2012, representing a decrease of 33%. Furthermore, December wafer start volume is approaching the lowest volume reached during the financial crisis in 2009, 986 thousand starts per month. Taiwanese DRAM makers have made the largest capacity cuts, from a high of 450 thousand starts per month in 2011 to December’s 250 thousand starts per month, a 44% decrease.

The results of the capacity cuts should be seen in the first half of 2012. Thus, although the DRAM market will remain in a state of oversupply for the rest of 2011, the outlook is optimistic for 2012 from the manufacturer's points of view.

From the supply and demand perspective, after the second round of production cuts in the second half of 2011, the forecasted sufficiency ratio for the global DRAM industry in the first half of 2012 has been adjusted downward, from 17% to 13%. Additionally, capacity cuts were all on commodity DRAM products. Thus, the severe oversupply situation is quickly improving, and the industry is headed towards balanced supply and demand.

 

Tags: DRAM, DDR3, Business

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Comments currently: 1
Discussion started: 12/14/11 12:55:44 PM
Latest comment: 12/14/11 12:55:44 PM

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Quick folks, we must act quick ! Seize the moment; ram is about the only thing the consumer can have for himself now days without paying a fortune. Seize the moment! I've already lost the moment to seize a hard drive (sort of converting external 2 TB to internal haha desperate times calls for desperate measures), let not this one pass away.
0 0 [Posted by: ericore  | Date: 12/14/11 12:55:44 PM]
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