DRAMeXchange: 2H’Oct. DDR3 2GB “Average” contract price declined 14.3% and 30% decline is expected in 4Q10

DRAMeXchange: 2H’Oct. DDR3 2GB “Average” contract price declined 14.3% and 30% decline is expected in 4Q10

Nov. 1st, 2010--According to DRAMeXchange, the research department of Trendforce, 2H’Oct. contract price indicated record high decline within a year that DDR3 2GB “Average” contract price dropped 14.3% to US$27 from US$31.5 while “Low” contract price even declined 15.2% to US$26. In September, DRAM vendors expect Oct. DDR3 2GB average contract price can sustain in the level of US$30 but we have seen the price cut from some DRAM vendors is unable to boost the demand effectively. This situation resulted in the sharply price decline in 2H’Oct. DDR2 contract price decline along with the DDR3 and current price negotiation has been completed based on the same price level as DDR since DDR2 portion in spot market is less than 10%. 

In the spot market, short-term inventory replenishment happened after China National Holiday. DDR2 1Gb eTT chip rose to US$1.86 and soon declined 8.6% to US$1.7. DDR3 ship slightly declined 5.8% to U$1.62. Spot market shows less volatility than contract market since DDR2 portion is higher in spot market than contract and price decline is comparably mild given the limit output. DDR3 market also indicated the low supply and low demand as well.

Despite of outperformed September NB shipment, yet overall quarterly growth is merely 2.6% since traditional hot season sale are not satisfactory. In DRAM output side, Samsung’s output growth will reach peak at 3Q10 given the outperformed technology node and early immersion scanner settlement and Samsung also record the good performance in terms of 3Q10 revenue. Other DRAM vendors will sharply increase output in 4Q10 given the immersion scanner settlement in 2H10 that they tend to offer the lower price to the buyers at the pressure of sales under over-supply situation. Those factor combined result in the acceleration of price decline in 2H’Oct. contract price. DRAMeXchange expect DDR3 contract price will likely be down 30% QoQ to US$20 by the year end.