Thu, Sep 23, 2021 page11

• DRAM selling price could drop 8%, TrendForce says

  DOWNCYCLE: Most buyers are wary about placing new orders, and although the decline could also be as little as 3%, it would be the first drop since the start of the year

  • By Lisa Wang / Staff reporter
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  The average selling price of DRAM chips next quarter is expected to decline by up to 8 percent quarter-on-quarter, with memory chips used in notebook computers and consumer electronics seeing the steepest decline due to excess inventory and a shortage of components, market researcher TrendForce Corp (集邦科技) said yesterday.

  That means the DRAM industry is entering a new downcycle after experiencing a boom for three quarters, the longest uptrend in the history of the industry.

  The Taipei-based researcher said it expects the balance between supply and demand to begin tilting toward a surplus in the final quarter of this year.

  Most DRAM buyers are cautious about placing new orders, as their inventories have risen above safe levels, TrendForce said.

  The average selling price of DRAM chips would slide between 3 and 8 percent next quarter from this quarter, the first decline since the first quarter of this year, it said.

  The price of DRAM chips for laptops would fall between 5 and 10 percent, as a decline in demand for laptops would cause a PC DRAM chip surplus of 1.38 percent, TrendForce said.

  Buying sentiment for Chromebooks is running out of steam, as students and workers are gradually returning to schools and offices after the US and European economies reopened, it said.

  As PC makers have speculated that DRAM prices could weaken further, PC DRAM chip prices might decline more than 10 percent for some transactions next quarter, TrendForce said.

  However, a slump in the PC DRAM segment would not likely trigger a large-scale downturn, as PC DRAM chips only account for a relatively small portion of major DRAM manufacturers’ total DRAM capacity, and chipmakers might allocate more capacity to server DRAM production amid steady server demand, it said.

  The price of DRAM chips used in servers would remain the same or drop up to 5 percent next quarter, as growth momentum is slowing from the third quarter because US and Chinese cloud-server providers have ensured they have high inventory levels for eight to 10 weeks, the researcher said.

  The price of DRAM chips used in consumer electronics would fall between 5 and 10 percent, as spending on home entertainment electronics is declining due to relaxed COVID-19 restrictions, it said.

  Besides, a severe component shortage has led to lower shipments of TVs, set-top boxes and networking devices, as well as industrial devices, dragging down demand for DRAM chips, TrendForce said.

  The price of DRAM chips used in mobile devices would be largely flat, but there is the likelihood of a decline due to high inventory levels ahead of the slack season in the first quarter, TrendForce said.

  Demand for DRAM chips used in graphics cards looks resilient amid a recovery in cryptocurrency mining activities and robust demand for commercial laptop computers, TrendForce said, adding that the price of graphics card DRAM chips would be flat or drop 5 percent next quarter, it said.

  Uneven supply of key components, including driver ICs, power management ICs and graphics cards is weakening buying sentiment, the researcher added.
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