TrendForce releases latest trends in memory spot prices. With subdued DRAM supply and demand, transactions are limited. NAND Flash shows low trading volumes as well, expected to persist until after the Chinese New Year. Details below:

DRAM Spot Market:

DRAM spot prices are rising steadily, with larger hikes for chips and smaller increases for modules. Regarding chip spot prices, DDR5 products have shown a sharper price increase compared to DDR4 products. However, the quantities that DRAM suppliers have released into the spot market have been fairly limited since the first quarter is the slow season, so transaction volumes are also modest.

Currently, some Chinese OEMs are winding down their operations in preparation for the Lunar New Year holiday, so the state of spot trading is expected to remain like this until the end of the holiday. The average spot price of the mainstream chips (i.e., DDR4 1Gx8 2666MT/s) rose by 1.00% from US$1.903 last week to US$1.922 this week.

NAND Flash Spot Market:

Suppliers are maintaining an extremely restricted shipment on 3D wafers, which explains the steady increase of prices despite low transactions, though the elevation of prices has fallen below that of recent DRAM spots. Client SSD is also amplifying in partial prices from ongoing demand of replenishment among fabs.

A number of Chinese fabs are going on holiday with Chinese New Year arriving imminently, and the current transaction status is likely to carry on until after the holiday. 512Gb TLC wafer spots have risen by 6.77% this week, arriving at US$3.437.

NAND flash memory giants Kioxia and Western Digital (WD) were reported to be in negotiations with intentions to merge. However, the merger talks between Kioxia and WD were halted in October last year due to opposition from SK Hynix, the South Korean memory giant indirectly invested in Kioxia.

As per a report from Japanese media 47news, Kioxia has been making adjustments behind the scenes and is interested in restarting merger negotiations with WD. Kioxia’s major shareholder, Bain Capital, is reportedly in negotiations with SK Hynix.

It is reported that Kioxia is also exploring the possibility of cooperation with SK Hynix, but this may pose risks of violating anti-monopoly laws. If Kioxia and WD ultimately fail to merge, going public independently is also an option for Kioxia.

According to the report citing sources, SK Hynix is concerned that a merger between Kioxia and WD would weaken its influence over Kioxia. Therefore, SK Hynix is interested in participating in the integration to safeguard its influence.

On the other hand, WD has announced on October 30 last year that its board had approved a spin-off plan to separate its NAND flash memory division and establish a new company for independent listing, with operations expected to commence in the second half of 2024.

As per TrendForce’s  data for 3Q23, Samsung maintained its position as the top global NAND flash memory manufacturer, commanding a significant market share of 31.4%. Following closely, SK Group secured the second position with a 20.2% market share. Western Digital occupied the third position with a market share of 16.9%, while Japan’s Kioxia held a 14.5% market share.

Read more

• [News] Kioxia and Western Digital Merger in Turmoil? Reports of SK Hynix Disapproval and a Possible SoftBank Collaboration
• [NEWS] Western Digital and Kioxia Terminate Merger Talk, TrendForce Believes M&A Will Be an Inevitable Trend

(Photo credit: Kioxia)

According to TrendForce’s latest report on memory spot price trends, the DRAM spot market is experiencing a clear upward trend driven by contract market demand. In contrast, the NAND Flash market appears relatively sluggish. Details are as follows:

DRAM Spot Market:

The significant rise in contract prices has also led to a corresponding increase in spot prices this week, and both DDR4 and DDR5 chips are experiencing a price rally. TrendForce has observed that spot buyers’ procurement quantities are not based on actual demand. Buyers are instead banking on future market conditions and raising their inventory levels. Hence, even though there are clear signs of quotes rising, transactions are still limited in terms of quantity. The average spot price of mainstream chips (i.e., DDR4 1Gx8 2666MT/s) rose by 0.69% from US$1.883 last week to US$1.896 this week.

NAND Flash Spot Market:

The spot market of NAND Flash has been rather sluggish compared to that of DRAM. 3D wafers, having risen in prices for a long while, are relatively stagnated now, where the mainstream 512GB TLC is retained at approximately US$3.3. Prices for other finished products are also relatively flat, with sporadic demand for replenishment, and no further magnification has been seen from overall transactions. 512Gb TLC wafer spots have risen by 0.97% this week, arriving at US$3.219.

According to the latest memory spot price trends released by TrendForce, the DRAM spot market is experiencing limited upswing due to poor channel demand, while the NAND Flash market is expected to enter a period of price stabilization, with the upswing also anticipated to converge. Details are as follows:

DRAM Spot Market:

In the spot market, Kingston has finally raised prices of DDR4 and DDR5 modules after a year without price hikes. However, Kingston has not raised prices significantly, and related transactions have been rather tepid. Currently, spot prices are converging on contract prices for DRAM modules. Since channel demand is not particularly strong, this round of price hikes is still limited. The average spot price of the mainstream DRAM chips (i.e., DDR4 1Gx8 2666MT/s) rose by 1.20% from US$1.833 last week to US$1.855 this week.

NAND Flash Spot Market:

The spot market, having undergone a significant price increment within a short span of time previously, has returned to its off-season demand after the dissipation of stocking momentum for year-end festivals, where orders for memory cards, USB flash drives, and SSD are lingering amidst sluggishness. The spot market, as projected by TrendForce, will be entering a price consolidation phase, followed by a subsidence in the increase of prices. 512Gb TLC wafer spots have risen by 2.28% this week, arriving at US$3.188.

The recovery of the memory industry is evident, with Taiwanese companies such as Macronix, Nanya Technology, and Transcend all showing month-on-month revenue growth in December last year. Additionally, contract prices for DRAM and NAND Flash are expected to continue rising in the first quarter of 2024. However, the global second-largest memory manufacturer, SK Hynix, plans a expansion, introducing a variable element to the memory market.

According to a report by the Commercial Times, SK Hynix disclosed that it might reduce the scale of DRAM production cuts in the first quarter, while adjustments to the NAND Flash production strategy may occur in the second or third quarter, depending on the situation.

In response to major memory manufacturers’ expansion plans, Taiwanese memory firms believe that Hynix’s expansion should focus primarily on DDR5 and HBM (High-Bandwidth Memory) products. Nevertheless, Taiwan currently specializes in DDR4 products, and it is not expected to impact product pricing.

According to a press release from TrendForce published this week, the DRAM contract prices are estimated to increase by approximately 13–18% in 1Q24 with mobile DRAM leading the surge. It appears that due to the unclear demand outlook for the entire year of 2024, manufacturers believe that sustained production cuts are necessary to maintain the supply-demand balance in the memory industry.

For consumer DRAM, manufacturers are aggressively raising contract prices, which has prompted buyers to stockpile early. This has greatly improved purchasing momentum. However, the first quarter coincides with the industry’s off-season, and end sales are expected to be weak and lead to increased inventory levels due to buyers’ early stocking strategies.

Manufacturers generally believe that in 2024—with the expanding penetration of HBM and DDR5 each quarter—low-margin DDR4 capacity will be crowded out, thereby leading to shortages. As such, DDR4 contract prices are expected to outpace DDR3 in the first quarter by 10–15%. DDR3 continues to be supplied by Taiwanese manufacturers, and with generally high inventory levels, its contract price increase is estimated at 8–13% for 1Q24.

(Image: SK Hynix)