[News] Conventional DRAM Prices Plunge Amid Oversupply, Raising Concerns for Taiwanese Firms

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According to a report by the Economic Daily News, the DRAM market remains sluggish, with prices continuously declining. Industry insiders admit that the current market conditions are worse than anticipated. The report cites sources who attribute the ongoing price corrections in conventional DRAM to weak end-market demand and oversupply.

TrendForce’s DRAM contract price data reveals that, as of late November, the average price of 8Gb (1Gbx8) DDR4 chips had dropped to $1.35, marking a 35.7% decline from $2.10 in July. Meanwhile, the average price of 16Gb DDR5 chips fell to $3.90 in November, a 3.7% decrease from October’s $4.05 and a 16.1% decline from $4.65 in July.

BusinessKorea also reports that demand for products such as smartphones and PCs has yet to recover, reflecting weak domestic consumer sentiment in major markets like China. This has prompted major IT companies to reduce their DRAM inventory levels. On the supply side, while Chinese DRAM manufacturers have yet to catch up with South Korean competitors in advanced segments like high-bandwidth memory (HBM) for AI applications, they are engaging in aggressive price competition in the conventional DRAM market. Reports indicate that a Chinese memory maker is selling 8Gb DDR4 DRAM at approximately $1—around half the market price—further driving down prices.

The Economic Daily News highlights that the ongoing price declines pose challenges for Taiwanese memory makers, including Nanya Technology, ADATA, Team Group, Apacer, and Transcend, potentially impacting their market outlook.

In a previous press release, TrendForce noted the capacity constraints caused by HBM production, are expected to have a weaker-than-anticipated impact on pricing. Additionally, capacity expansions by Chinese suppliers may prompt PC OEMs and smartphone brands to aggressively deplete inventory to secure lower-priced DRAM products. As a result, contract prices for conventional DRAM and blended prices for conventional DRAM and HBM are expected to decline.

(Photo credit: SK Hynix)