TrendForce: Average 4GB Contract Price Stays Flat, 2GB Module Price Increases Slightly in 2HMay - Continued Uptrend Dependent on 2H12 Demand

According to DRAMeXchange, a research division of TrendForce, 2HMay 4GB module price stayed flat compared to the first half of the month - highest price did not exceed US$21.5. 2GB module price showed a slight increase, with average price falling around the US$11.25 mark, a 2.3% increase compared to 1HMay (Figure 1). From the beginning of 2Q to the end of May, 2Gb DDR3 contract and spot price trends have increased by 5.4% and 3%, respectively (Figure 2).

From the demand perspective, PC OEM inventory levels are generally high this month, with 4 to 6 weeks' worth of DRAM stock on average. PC OEMs have replenished inventory earlier than planned to prepare for the peak season as well as to guard against further DRAM price increase. Looking at the supply side, Korean makers continue to work towards transitioning to non-commodity DRAM production. Furthermore, as DRAM makers are all migrating to more advanced process technology, yield rate will be unstable and 3Q should see more balanced supply and demand than 1H12. With global economic visibility low due to the European debt crisis, the continuance of the DRAM price uptrend will be dependent on the peak PC sales season in 2H12. As June is traditionally an off-peak month, TrendForce expects the uptrend will slow, with price increasing only slightly or staying flat.