Recently, the DRAM and NAND memory markets have seen a disappointing upward trend in prices for consumers, which is already directly affecting the price of end devices (SSDs and RAM for mobile gadgets and computers). It is likely that this trend will only intensify in the future.
DigiTimes reportsthat as a result of the earthquake in Taiwan on April 3which was the strongest in 25 years, local semiconductor fabs sustained some damage, seriously disrupting the supply chains of leading manufacturers — Micron, Samsung Electronics, and SK Hynix. This could lead to a larger-than-expected price increase, especially in the context of the industry’s attempts to recover the losses of recent years through price increases.
Although memory prices have typically risen sharply in the past following production disruptions caused by natural or man-made accidents, the current situation offers suppliers an opportunity to recover losses in 2022 and 2023. Pre-earthquake growth rates contract prices for DRAM and NAND memory slowed down compared to the first quarter. For NAND, in particular, the growth was 15%-20% compared to 20+% in the first quarter. Now it is likely that price growth will accelerate.
It is reported that the major players have stopped publishing contract prices for DRAM, preparing to revise their pricing policies. And Micron, after the earthquake, began discussing with customers a new delivery schedule and possible delays. Yes, this is all unofficial information from insiders, but given the circumstances, it looks plausible.
Memory module manufacturers, which currently have limited stocks, are preparing for increased costs of purchasing chips. They had hoped that the upward trend in prices would slow down, but suppliers significantly reduced production last year to pull up prices amid stagnant demand. The new circumstances are likely to encourage customers, especially server manufacturers, to actively buy up memory in anticipation of a likely shortage, which in turn will push prices even higher.
If this is the case, it will hit server manufacturers hardest, but the consumer SSD segment, which has been experiencing price increases for the past few months, will not be spared the new wave.