DRAM chip prices projected to drop by 13-18 percent in the fourth quarter of 2022
DRAM, or dynamic random-access memory, prices are projected to decline 13-18 percent quarterly in the fourth quarter, sharper than the previous quarter. This information has been given in a report, as consumer demand for electronic components remains stable and macroeconomic conditions. Research firm Trendforce said rising inflation has significantly dampened demand for consumer products, which is likely to lead to further fall in buying demand towards the end of the year. According to the Yonhap news agency report, lower demand will lead to a 10 to 15 percent drop in the price of DRAM, which was estimated for the third quarter.
DRAM is a type of variable semiconductor memory that retains data as long as power is supplied. It is commonly used in personal computers, workstations and servers. According to Trendforce, the decline in consumer demand led to delays in purchases by DRAM customers and increased supplier inventory pressure. Falling DRAM prices are bad for two South Korean chip giants Samsung Electronics and SK Hynix, which have a combined market share of more than 70 percent. Samsung led the DRAM market with 42.7 percent market share in the first quarter, followed by SK Hynix at 27.1 percent. Demand for server DRAM, which has supported South Korean chip makers’ bottom lines amid tough market conditions, has also slowed amid rising inventory levels. Trendforce estimates that server DRAM prices will drop by about 13 to 18 percent in the three months ending December. The global chip market has entered a downcycle.