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Memory Prices May Plunge 25 Percent In 2019

The tech market has been in the midst of a brutal memory shortage that has seen prices skyrocket to incredible levels, but your next kit of RAM, or graphics card, may be much cheaper – to the tune of 25%.

Market analysis firm DRAMeXchange says memory prices could drop 15-25% in 2019. Contract negotiations with DRAM suppliers have begun for the fourth quarter, and while prices of PC RAM have remained steady, pricing for graphics memory has begun to recede amidst signs of softening DRAM demand across the board.  

The industry is quickly transitioning to new, smaller 1X/1Y RAM nodes that have higher density, but demand is simultaneously flattening. Additional fab capacity has also come online, and SK Hynix's new Wuxi fab will begin pumping out bits in 2019. That sets the stage for a pricing slump. Chinese regulators have also recently met with memory vendors, like Micron and Samsung, to express concerns about the continuing shortage among fears of price fixing, but the impact of those talks on the supply situation remains unclear.

Graphics DRAM pricing has been one of the prime contributors to the recent graphics card shortage, though cryptominers also played a key role in boosting demand beyond supply. The crypto craze has finally petered out as the price of cryptocurrencies plunge at coin exchanges, and the sudden drop in demand has surely had a role in reduced graphics memory pricing.

Bean-counting outfit IC Insights reminds us that DRAM vendors have gotten fat off the land during the shortage. For the first time in history, DRAM could be the first individual IC category to break $100 billion in yearly revenue. The NAND flash segment is also booming as it exits the worst shortage in history, but industry soothsayers also predict a tremendous drop in SSD pricing as we enter next year. That means that 2019 may find us with a spate of new CPUs and GPUs to pair with cheap and plentiful memory and SSDs.