by Anton Shilov
04/23/2012 | 09:19 PM
Although the dynamic random access memory (DRAM) market remains in the state of oversupply, SK Hynix Semiconductor and Samsung Electronics ceased to slash memory prices in the first half of April due to uncertain situation with Elpida Memory and other market developments. As a result, contract prices on DRAM increased slightly in first half of April.
DRAMeXchange, a research division of TrendForce, as buyers and vendors have been in disagreement over price this month, first half of April contract price figures were not available until the third week of April. Average 4GB and 2GB module price was $20.25 and $10.5, respectively, representing increases of 6.58% and 5%. The DRAM market researchers attribute price growth to uncertainties with Elpida and reluctance of South Korea-based makers to reduce DRAM prices.
Nonetheless, DRAMeXchange DRAM industry remains in a state of oversupply (latest sufficiency ratio is 12%). As DRAM suppliers are gradually nearing fully loaded capacity, the supply and demand gap has not shrunk noticeably. From the demand perspective, although industry players generally believe PC shipments will see gradual recovery this year, PC OEMs indicate that April shipments have not met expectations. This discrepancy is evident on the spot market – since Elpida filed for bankruptcy in late February, 2Gb chip price has been fluctuating around $1, an indication that consumer demand is insubstantial.
Aside from continuing migration to the 20-class nm process, leading DRAM makers plan to gradually decrease PC DRAM output ratio due to increasing demand for mobile and server DRAM. Makers are also taking a firm stance on price negotiations. TrendForce believes the DRAM industry will gradually transition from a competitive market to an oligopoly, where manufacturing and price strategies keep each other in check and there will be a return to stricter market discipline.
TrendForce expects that as suppliers continue to avoid steep discounts, DRAM price quotes will continue on an upward trend. As DRAM suppliers’ are generally approaching fully loaded capacity and Elpida has not yet announced any capacity withdrawal, the contract price trend increase is expected to gradually slow in the future.