Dram Prices Stabilize, Growing Expectations for a Super Cycle

Semiconductor wafer

[Asia Economy Reporter Changhwan Lee] The fixed price decline of major memory semiconductor products has stopped after six months. Spot prices have already risen significantly, raising expectations for an improvement in the semiconductor market going forward.

According to market research firm TrendForce on the 2nd, the fixed transaction prices for 16GB server DRAM (DDR4 16GB R-DIMM) and 32GB server DRAM last month were $65 and $110 respectively, maintaining the same prices as the previous month. Server DRAM prices had fallen for five consecutive months from July to last month due to increased inventory in the second half of last year, but the price decline stopped in December.

The average fixed transaction price for PC DRAM (DDR4 8Gb) also remained unchanged at $2.85 following November. TrendForce analyzed that "customers' inventories have relatively decreased, and the power outage at Micron's Taiwan factory created a favorable environment for suppliers."

Spot prices, which serve as a leading indicator for fixed prices, are already on the rise. DRAM spot prices, which were around $2.7 at the end of November, surged nearly 30% to $3.46 by the end of last month.

This is the first time in six months since May that DRAM spot prices have reached the $3 range. DRAM Exchange expects the DRAM price rebound to continue, potentially rising up to 10% in the first quarter of next year.

The semiconductor industry anticipates that the semiconductor market could enter a supercycle (a period of booming growth) for the first time in three years this year. Supply is limited, while demand driven by the non-face-to-face (untact) trend due to the COVID-19 pandemic continues, leading to increased semiconductor sales and potentially higher prices.

According to KOTRA's '2021 Export Outlook,' the semiconductor market is expected to enter a supercycle next year, with demand increasing by 19% for DRAM and 34% for NAND flash compared to this year. In fact, South Korea's semiconductor exports have significantly increased for several months up to last month, driving overall export improvements.

This content was produced with the assistance of AI translation services.