In the latest report published by TrendForce the market situation of the dynamic random access memory (DRAM)which is a specific type of RAM present in all computers, reflecting a significant drop in terms of its production, and therefore, in its market price.
Despite the fact that we are immersed in a time in which new technologies do not stop growing at a frenetic pace, the iTrendforce report shows that providers like Micron and SK hynix have reduced their production considerably, experiencing a 20% price drop in the first three months of 2023. The forecast for the following quarter is not rosy either, as it is expected for prices to be reduced again by 10-15%.
Inventory levels are highThat is why production has dropped, and until sales increase, neither prices nor the generation of DRAM ASP will be able to rise again. In the PC sector, DDR4 has fallen between 15% and 20% and the ddr5 between 18% and 23%, despite the fact that it is in the development stage.
The memory for serverswhich a few years ago was very difficult to obtain in a period of less than six months, has seen its price fall by up to 28%, while the mobile memory has decreased by 13-18%. For her part, the GDDR fell 18-23% and the drams for uses in the consumer sector by 18-23%.
The GPU memory has not been affected by the latest debates on AI, showing that the demand for GDDR6 8GB has dropped significantly. The industry is in transition to 16GB modules and 8GB chips that will be EOL by the end of the year.
Situation by typology
- PC-DRAM: The buying power of buyers has been reduced in the last three quarters and stocks are expected to be around 9-13 weeks left. The 8GB DDR4 module is expected to drop in the second quarter of the year by 10%. If PC OEMs buy more DRAM by lowering prices, this could be mitigated considerably.
- Server DRAM: Consumer demand is not very promising, so manufacturers increased their inventories, although this has left them with a significant excess. Most vendors have reduced their utilization rates such that during the second quarter the ASP of server DRAM is expected to drop by 13-18%.
- Mobile DRAM: Brands have adopted a conservative action plan in the production of smartphones, limiting the purchase of mobile DRAM during the second quarter. TrendForce predicts that mobile DRAM ASP will fall as we move into Q2 by 10-15%.
- Graphics DRAM: Even without a big impact on AI demand, buyers have been stocking up. 16GB GDDR6 is predicted to fall by 10-15% quarter-on-quarter. The DRAM industry is in a transition from 8 to 16 GB, so 8GB GDDR6 is expected to reach its peak by the end of the year. Starting in 2024, SK hynix will be the only company to offer 8GB products.
- Consumer DRAM: Nascent demand for network devices has held steady, although buyers have scaled back their purchasing activities. they have some very conservative outlook related to the network and the application market, including television. Thus, supply will continue to exceed demanda, even when suppliers significantly reduce their production. Trendforce estimates that the ASP of consumer DRAM will fall between 10% and 15% during the second quarter of the year.
market prices
As a conclusion, and with the production and sales data in hand, Trendforce gathers that there are DDR5-5600 memories for 4.13 euros/GB either DDR5-5200 at 3.7 euros/GB. The cost of the 32GB of DDR5-6000which are recommended for Ryzen 7000 and a minimum for Core, are at 150 euros, something that drives the sale of AMD processors. All this could lead, as a consequence, to a drop in motherboard prices.
Perhaps the best advice users can be given, using this Trendforce data as a reference, is to upgrade their RAM by June 30, 2023. The DRAM supply reduction will not be felt in the market and in retail until after a while, something that will determine if prices continue to decline during the third quarter.
