[News] DRAM Price Surge Halts, Could HBM Demand Drive Price Increases?

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The recovery in demand for PCs and smartphones will take time, leading to a halt in the upward trend of DRAM prices, remaining stable for two consecutive months. However, the rapid growth in demand for High Bandwidth Memory (HBM), essential for data center servers and generative AI, is expected to boost future DRAM prices as the production trend of HBM rises.

The Nikkei News reported on May 18th that the recovery in demand for PCs and smartphones will take time, leading to a halt in the upward trend of DRAM prices used in smartphones, PCs, and data center servers for temporary data storage.

In April 2024, the wholesale price (bulk transaction price) of the benchmark product DDR4 8Gb was around USD 1.95 per unit, and the price of the smaller capacity 4Gb product was around USD 1.50 per unit, both remaining unchanged from the previous month (March 2024) and marking the second consecutive month of stability.

As of February 2024, DRAM prices had risen for four consecutive months. DRAM wholesale prices are negotiated between memory manufacturers and customers monthly or quarterly. Reportedly, approximately 50% of DRAM demand comes from PCs and servers, while around 35% comes from smartphones.

The report indicated that the demand for HBM, essential for generative AI, is rapidly increasing, and market expectations for the production trend of HBM are expected to boost future DRAM price increases.

A source cited in the report, which is an Electronic product trader, noted that some major manufacturers have accepted the memory manufacturers’ price hike requests. A PC manufacturer source cited by the report also stated that DRAM wholesale prices from April to June are expected to rise by 5-10% compared to January to March.

Another source cited by the report stated that the facilities required to produce HBM are approximately three times larger than those needed for producing general DRAM. If HBM production increases, the production volume of other DRAMs will decrease, thereby driving up prices. Another source cited in the report stated that supply cannot keep up with demand, and pricing power is currently in the hands of memory manufacturers.

Read more

• [News] Samsung and SK Hynix Urgently Reallocate 20% of DRAM Production Capacity to Support Rising HBM demand
• [News] Three-way Contest for HBM Dominance, Uncertainties Surrounding China’s Supply Chain Involvement

(Photo credit: SK Hynix)