The price of DRAM, used for temporary data storage on smartphones, PCs, and data center servers, has risen for two consecutive months. The primary reason is the reduction in production and supply by upstream manufacturers, and the acceptance of their price increase requests by clients.
In December 2023, the wholesale price of the benchmark product, DDR4 8Gb (bulk transaction price), was around $1.70 each, a 3% increase from the previous month (November 2023). The smaller capacity 4Gb product was priced at about $1.30 each, a 4% increase from the previous month, marking the second consecutive month of price increases. Compared to the same month last year, the prices of both 8Gb and 4Gb have fallen by about 10%. The wholesale price of DRAM is negotiated between manufacturers and clients monthly or quarterly.
Reports indicate that due to the production cuts by various manufacturers and the alleviation of market oversupply, the wholesale price of DRAM in November 2023 rose for the first time in about two and a half years. To improve profits, manufacturers will continue to demand price increases.
Additionally, during an interview at the CES event in Las Vegas, USA, SK Hynix CEO Gok Lu was asked whether he considered slowing down the storage production cut measures. He responded that “it’s possible that the DRAM production cut plan will change in Q1 (January-March 2024), and similar measures (changing the production cut plan) for NAND Flash might be taken after the first half of the year.” Gok Lu noted that “there are signs of recovery in DRAM, but the recovery of NAND Flash is slower.”
In December 2023, the American research firm Gartner released a forecast report stating that driven by the expected double-digit growth in storage, 2024 is anticipated to be a rebound year, with global semiconductor revenue projected to surge to $624 billion, an increase of 17% year-on-year.
Gartner pointed out that in 2024, storage demand is expected to show a strong recovery, with revenue projected to skyrocket by 66.3%. Specifically, Flash Memory revenue in 2024 is estimated to surge by 49.6%, and DRAM revenue is expected to skyrocket by 88%.
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