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Strong Stock-Up Demand Pushed Prices of 4GB DRAM Modules to a High of US$14 in August, Says TrendForce

1 September 2016 Semiconductors Avril Wu

DRAM prices in August were on an upward trend as they were in the previous month, reports DRAMeXchange, a division of TrendForce. The monthly average of contract prices for 4GB modules (DDR3 and DDR4) rose by 2% sequentially to US$13.5, while the monthly high rose by 3.7% sequentially to US$14.

Some PC-OEMs still purchased 4GB modules at the monthly low price of US$13 in August due to arrangements they had made with suppliers in the previous quarters. However, both the monthly high and average of contract prices continued to climb on account of upside demand.

DRAM prices are expected to keep climbing in fourth quarter as memory products for all applications are in short supply

“With the official launch of the next iPhone release on September 7, the entire smartphone supply chain is now under a critical period of intense stock-up activities,” said Avril Wu, research director of DRAMeXchange. “At the same time, there is still high demand for memory components from Chinese smartphone brands, so both the DRAM and NAND Flash markets are experiencing tight supply.”

“Demand for servers has also heated up recently,” Wu pointed out. “Contract prices of server DRAM finally stabilized in August and even rose 1~3% against headwinds compared with the prior month. After suffering quarterly price decreases of over 10% during the first half of this year, server DRAM finally got off the downtrend.”

Wu added that major DRAM suppliers have reallocated more of their production capacities to make mobile and server products: “As a result, the supply of PC DRAM has also tightened. Given this situation, clients that want to place additional PC DRAM orders in this third quarter now have to accept higher prices, and those without lock-in arrangements for the quarter may see prices as high as US$14 for their extra orders. In sum, DRAM prices have been on an upswing during this August, and DRAMeXchange anticipates another wave of larger price increases in the fourth quarter of this year.”

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