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DRAMeXchange, a research division of global market research firm TrendForce, contract prices of DDR3 memory remained relatively stable in November compared to the second half of October. Analysts claim that even with the lack of noticeable improvement for DRAM demand, buyers are still more open to slightly higher prices than they have been in the past.

The data from DRAMeXchange shows that the contract price on 4GB DDR3 memory module stayed at around $15.75, or flat, in the first half of November, while lowest 4GB price was $15.5; average 2GB DDR3 module contract price fell around the $9 mark, which equates to $0.83 for 2Gb, not much of a difference from spot price.

At press time, one untested [eTT] 2Gb DDR3 chip cost $0.692 on average in Taiwan's spot market, 2Gb DDR3 1333MHz/1600MHz chip's price was approximately $0.828/$0.822, whereas 4Gb DDR3 1600MHz memory IC was priced at $2.088 on average on the spot market.

In the past six months, oversupply on the DRAM market has resulted in a 25% price decline from this year’s high to the current price, a figure that has already fallen below manufacturing cost for some manufacturers. As some DRAM suppliers have cut capacity in the second half of the year, the downtrend has seen a little relief; contract prices of 4GB DDR3 modules are very likely to stay above $15 for the month of November, putting an end to the monthly $1 decrease for the time being.

The PC industry has entered the traditional peak season for shipments, but macroeconomic factors have resulted in weaker PC shipments than usual this year. However, despite the fact that the DRAM market remains in oversupply, previous capacity cuts are already taking effect and the DRAM price decline has eased. The same goes for mobile DRAM price; with strong smartphone and tablet shipments in the fourth quarter, average price decline for mainstream density mobile DRAM is in the 5-10% range, down from over 10% in the past few quarters.

PC shipments have suffered the hardest blow from global economic sluggishness. As consumers are putting off upgrades, the release of Windows 8 did not provide any significant benefit to PC shipments. For November, PC OEM notebook shipment turned out to be 7% lower than the figures in the previous month, and is projected to dip even further during December.

While PC makers are willing to purchase inventory, their offers are far lower than DRAM suppliers’ desired prices, which has extended many negotiations into the second half of November. Aside from waiting for the global economy to improve, DRAM suppliers can only reduce losses by improving prices, which requires continual capacity cuts to bring supply and demand levels back into balance.

Tags: DRAM, Business, DDR2, DDR3, Samsung, SK Hynix, Micron, Elpida, Powerchip Semiconductor, Inotera, Nanya

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