DRAM Manufacturers Ramp Up Production

News
By Douglas Perry
published

It appears that the DRAM memory market has bottomed out and prices have begun to stabilize.

Manufacturers have reacted almost immediately and there are reports that vendors are increasing their production volume again. Tier 1 manufacturers cut their production volume in Q4 to halt a dramatic price decline.

According to Digitimes, DRAM producers have added 100,000 wafers to their output in Q1 to move towards a balance of supply and demand. Forecasts indicate that DRAM demand may rise by 30 percent in the current quarter. Digitimes said that average selling prices for 4 GB DDR3 DRAM modules have increased by about 6 percent to $18 since Q4. 2 GB DDR3 DRAM also showed higher selling prices than in the last quarter.

Elpida remains a uncertain variable in the DRAM market, which could make a major impact on near-term DRAM pricing. The company recently stated that it was not able to renegotiate its debt, which caused speculation that the company may now be forced to merge with Micron. Elpida still has until March 22 to come up with a solution to address a pile of $4 billion in debt.

Analysts such as Raymond James’s Hans Mosesmann predict that a Elpida will have a "significantly diminished" capacity to produce DRAM, which could push the prices of the memory higher.

Douglas Perry
29 Comments Comment from the forums
  • vviikkrraanntt
    can't they do the same thing with HDD?
    is there anyone who even uses DRAM?
    Reply
  • amuffin
    vviikkrraannttcan't they do the same thing with HDD?is there anyone who even uses DRAM?fail.....
    all of the stuff is flooded and evrybody uses dram, phones computers etc. The very computer you are using is using dram.
    Reply
  • builder4
    Tier 1 manufacturers cut their production volume in Q4 to halt a dramatic price decline.

    How is this not collusion? Wikipedia states collusion is "an agreement among firms to divide the market, set prices, or limit production", and is this not an agreement to limit production?
    Reply
  • alidan
    you know with haveing to much ram... you would think they would invest more in higher density 8gb sticks and make them the norm. drive those prices down to reasonable levels.

    i have 8gb of ddr2, and cant realistically get more ram, because it would be cheaper to get a new motherboard and load that up with 16-24gb of ram than to get 16gb of ddr2... what im waiting for right now is for 8gb sticks to come to a reasonable price. im already constantly using 7.5gb+ right now, i don't even have all the programs i want open.
    Reply
  • emperorxyz
    builder4How is this not collusion? Wikipedia states collusion is "an agreement among firms to divide the market, set prices, or limit production", and is this not an agreement to limit production?
    I'm guessing they didn't actually have any agreement. They each independently had their financial people tell them that there is a dramatic price decline. Heck, they can notice that themselves, we all have. Knowing that there is a price decline, they each independently decided to cut their production simply because the price they will sell might be actually lower than the cost of production, so they would take a loss on each sale and it doesn't take a genius to decide that they should cut production. The key is they each decided independently from the others without any agreement.

    Anyway, that's the principle. I'm not saying they didn't have any agreement. They might have had in secret. I'm just saying that it is plausible that they each decided to cut production based on the market condition.
    Reply
  • memadmax
    Sounds right now a good time to stock up on some ram chips.
    But however, I am afraid of my investment getting trumped by the next gen of RAM, whatever it may be. It seems like a new gen of ram comes out every 4/5 years and DDR3 is at the 5 year mark(serious production in 2007).
    Oh well, we shall see.
    Reply
  • tomfreak
    where is the 8Gb module when you need it to be just as cheap per GB as 4Gb ones?
    Reply
  • Christopher1
    emperorxyzI'm guessing they didn't actually have any agreement. They each independently had their financial people tell them that there is a dramatic price decline. Heck, they can notice that themselves, we all have. Knowing that there is a price decline, they each independently decided to cut their production simply because the price they will sell might be actually lower than the cost of production, so they would take a loss on each sale and it doesn't take a genius to decide that they should cut production. The key is they each decided independently from the others without any agreement.Anyway, that's the principle. I'm not saying they didn't have any agreement. They might have had in secret. I'm just saying that it is plausible that they each decided to cut production based on the market condition.
    Personally, I am betting more towards the illegal collusion argument here..... seen way too many times these tech companies having 'dirty laundry' come out a few months/years after they do something like this that shows that, yep, they were colluding.
    Reply
  • RealBeast
    8 Gb sticks will come down in price, but what I want to see is better speed and timings on them. Most of the stuff out now, besides being expensive, is only 1333.
    Reply
  • ScrewySqrl
    Realbeast8 Gb sticks will come down in price, but what I want to see is better speed and timings on them. Most of the stuff out now, besides being expensive, is only 1333.

    actually at the bottom, 1333 and 1600 are about the same price for 8 GB (2x4GB), at 4 GB (2x2GB), 1600 is cheaper than 1333.
    Reply