End To DRAM Price Surge

Is the DRAM price surge over? IC Insights reckons that the 2Q14 DRAM ASP is expected to be just slightly less than in 1Q14.DRAM unit volume shipments are forecast to be 3.40 billion in 2Q14, flat with 1Q14 but down 5% compared with 2Q13 and down 15% from 2Q12.

Except for November, DRAM average selling prices increased each month of 2013. Moreover, in February of 2014, the DRAM ASP reached $3.19, its highest level since February of 2007!

However in March the DRAM ASP dropped to $2.98 and fell again slightly to $2.96 in April (the first two month decline since 2011).

The DRAM ASP is still forecast to be 24% higher in 2Q14 compared to 2Q13 and 74% greater than two years earlier in 2Q12.

With the number of major suppliers reduced to three, the industry is expected to enter a more mature and stable state.

The switch to higher priced mobile DRAM has also contributed to rising DRAM average ASPs.

Shipments of smartphones and tablet PCs are increasing rapidly while shipments of traditional notebook and desktop PCs are flat or falling.

To meet the needs of the growing mobile market, most DRAM suppliers have shifted their product mix to increase their output of low-power (but higher-priced) mobile DRAM and scaled back their production of PC DRAM.

While DRAM ASPs have been on the rise, DRAM unit shipments have trended in the opposite direction.

In 2012, DRAM units fell 4% from the all-time high of 16.2 billion set in 2011, then dropped a sharp 11% in 2013.

DRAM shipments are forecast to be essentially flat in 2014 and 2015.

Through 2018, DRAM shipments are forecast to remain within a very tight window of 13.5 billion to 13.9 billion as increases in mobile DRAM unit shipments offset declines in PC DRAM unit shipments.

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