DRAM Prices Rebound After 2 Years... Clear Recovery in Memory Market Conditions

DDR4 DRAM Fixed Transaction Price Up 15.38%
Industry Production Cuts and Price Increase Attempts Effective

NAND Fixed Transaction Price Also Rises Over 1%
Industry Accelerates Recovery with Increased Production Cuts

Last month, DRAM prices rose by about 15%, marking a rebound for the first time in two years. Last month, NAND flash prices also showed an upward trend for the first time since July 2021.

On the 1st, market research firm DRAMeXchange announced that the average fixed transaction price (business-to-business price) of general-purpose DRAM products for PCs (DDR4 8Gb 1Gx8) last month rose 15.38% from the previous month to $1.50.

This is the first time DRAM fixed transaction prices have increased since July 2021. At that time, DRAM prices were $4.10, but then continued to decline, reaching about $1.30 in September, down approximately 68%.

The semiconductor industry believes that the price increase was due to production cuts by the DRAM top three (Samsung Electronics, SK Hynix, and US-based Micron) along with ongoing attempts to raise prices.

Market research firm TrendForce expects that this trend will continue, with DRAM prices in the fourth quarter rising 3-8% compared to the previous quarter. In particular, mobile DRAM, which is in peak season, is expected to see a relatively high price increase of 5-10%.

TrendForce explained, "On the supply side, Samsung Electronics is making large-scale production cuts, and Micron is trying to raise prices by 20%, creating an overall atmosphere of price increases across the industry."

On the demand side, the effects of high-value-added DRAM such as High Bandwidth Memory (HBM) and Double Data Rate (DDR) 5 are becoming visible. Due to the generative artificial intelligence (AI) effect, demand for these DRAMs exceeds supply, leading to a recovery in the market.

In fact, the average selling price (ASP) of DRAM for Samsung Electronics and SK Hynix in the third quarter rose by mid-single digits to double digits percentage compared to the previous quarter. SK Hynix also succeeded in turning DRAM profitable in the third quarter due to the expansion of high-value-added DRAM sales.

NAND is also showing signs of market recovery, albeit slower than DRAM. Last month, the fixed transaction price of NAND for memory cards and USBs (128Gb 16Gx8) was $3.88, up 1.59% from the previous month. This is the first rebound since July 2021.

TrendForce forecasts that NAND prices will rise 8-13% in the fourth quarter. It also pointed out that "continuous production cuts are necessary" for the price increase trend to continue into next year.

Major companies including Samsung Electronics and SK Hynix are increasing the scale of NAND production cuts focused on legacy (older) products to reduce inventory and raise prices in the market. At the same time, they are also focusing on transitioning to advanced process technologies.

Kim Jae-jun, Vice President of Samsung Electronics' Memory Business Division, said at the recent third-quarter conference call, "We plan to prioritize cost and product competitiveness and accelerate the transition to advanced process technologies with the latest products (V7, V8)."

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