It's always difficult to anticipate DRAM price trends, but the rise that's coming was predicted.
The Covid-19 pandemic and logistical chaos in 2020, followed by the outbreak of war in Ukraine and global uncertainty, were the main causes of the last two sudden periods of inflation in the prices of DRAM(Dynamic Random Access Memory) chips, which are used in our smartphones and PC RAM arrays. Since 2023, however, we've become almost accustomed to prices trending downwards - slowly, admittedly, but downwards nonetheless. What's more, the gradual arrival of DDR5 has seen the price of DDR4 come down somewhat, especially as Chinese manufacturers have set their sights on this "old" generation, bringing prices down sharply.
This incursion by Chinese companies into the DRAM market is perhaps no stranger to the price hike we're likely to see this time very soon, and possibly very hard. Quoted by TechRadar, research firm TrendForce doesn't pull any punches, predicting nothing less than a price rise of 38% to 43% for DDR4 for PCs alone by the third quarter of 2025. DDR4 for servers would be slightly less affected, with an increase of between 28% and 33%. Why such an increase?
An estimate of expected increases in DRAM © TrendForce
If you follow IT news, especially on DriversCloud, you may already have part of the answer. It's already been several months since the three main manufacturers - the "majors" Micron, Samsung and SK Hynix - largely turned the page on DDR4. Their production lines have already been redirected towards the more lucrative DDR5, or even more profitable technologies such as HBM memory. Until now, Chinese manufacturers, and in particular CXMT, their leader, had taken up the slack rather well, and prices were even trending downwards, thanks to their determination to gain a foothold in a market new to Beijing.
The problem is that Beijing has recently decided to move away from DDR4 towards DDR5 and even HBM, and towards more high-end products. As we reported in early June, the Chinese government has forced CXMT to reorient its production lines towards DDR5. Logically, this should have an impact on the price of DDR5 - for which, despite very strong demand, the increase would only be between 3% and 8% - but much less encouragingly on the price of DDR4. While demand remains strong, particularly in the entry-level segment, supply will fall drastically, and the rest is history... The question is whether to buy today in the hope of anticipating this rise, or to wait for the storm to pass.
