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Press Release


TrendForce Says Overall DRAM Market to See Upward Price Trajectory Through 2017 Despite Recent Dip in Spot Price of DDR4 Chips

Wednesday , 04 / 26 / 2017 [ Analysts: Avril Wu ]

DRAMeXchange, a division of TrendForce, reports that the average spot price of PC DRAM DDR4 chips has fallen by about 1.92% since April 20. Latest analysis indicates that PC DRAM's chip prices generally have been higher in the spot market than in the contract market.. The recent drop in the average spot price of PC DRAM DDR4 chips is thus a correction to limit the price gap between the two markets. Nonetheless, DRAMeXchange maintains the view that DRAM prices will generally stay on an uptrend during the entire 2017. This is mainly attributed to tight supply resulting from the lack of major fab expansion plans and yield issues with leading-edge processes.

“Most contract negotiations for the second quarter have been completed during the latter half of this April,” said Avril Wu, research director of DRAMeXchange. “The average contract price of mainstream modules for the second quarter is expected to go up 10~15% from the first quarter. The average contract price of 4GB DDR4 modules is also projected to reach US$27, which translates to around US$3.06 for each 4Gb chip used in these modules. This price is still lower than the average spot price as it has been for a long time.”

Wu also pointed out that the 1.92% drop in average spot price of DDR4 chips from about US$3.38 to the current US$3.32 indicates an attempt to narrow the price difference between the contract and the spot market. In the short term, the spot price of DDR4 chips will turn downward slightly.

Looking at the DRAM market as a whole, the April to May period is within the traditional slow season for shipments of end products. With the Chinese New Year long gone, stock-up activities from device vendors tend to be muted until the back-to-school season and the holiday sales events in the year’s second half. On the other hand, PC-OEMs expect DRAM supply to remain tight through the entire 2017. They also intend to expand their memory inventories so that they are well prepared for the busy season in the second half. Therefore, DRAMeXchange expects contract prices of PC DRAM modules to keep going up despite seasonal headwinds.

Furthermore, major suppliers are encountering yield issues as they transition to processes more advanced than the 20nm class. Additionally, suppliers do not plan to raise their production capacity significantly this year. Thus, the DRAM market will see only marginal supply growth in 2017. This in turn will keep the general price trajectory for DRAM products upward for the whole period.

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