The increase in DRAM quotation will expand again

Jessie February 23, 2024

DRAM prices will also rise, this week all kinds of products raised prices.

With the three original factories controlling the supply, the firm attitude of lifting the quotation will promote the DRAM market price to further increase.

In the second quarter, it is estimated that the price increase of DRAM contract will converge from double digits in the past two quarters to single digits, and it will be re-expanded due to four driving forces from the third quarter, suggesting a dip layout.

Since December last year, most investors have worried that the downward revision of the demand outlook for general purpose servers and personal computers, coupled with the gradual reduction of production cuts by original manufacturers, will drag down the supply and demand balance this year, and the price increase of DRAM contracts has been reduced from 19% in the fourth quarter of last year and 17% in the first quarter of this year to 5% in the second quarter.

Four drivers will drive DRAM contract prices to expand to 10% from the third quarter.

First of all, the estimated overall HBM chip volume this year has been revised from 136,000 pieces to 153,000 pieces, accounting for the proportion of overall DRAM chip volume from 8.7% to 9.4%, and the effect of crowding out the overall DRAM chip production capacity has expanded.

Secondly, manufacturers have not actively built new factories, so that some of the factory clean room space is exhausted, the process upgrade will cause a permanent reduction in the amount of casting, a total of 165,000 pieces of production capacity per month, it is estimated that SK Hynix and Micron operating rate in the first quarter close to full load, the follow-up further loading space is quite limited.

Third, Samsung's operating rate is expected to increase to 79%, 87%, 94% in the first three quarters, the loading speed is significantly slower than the industry, and continue to dynamically adjust the operating speed according to demand and inventory situation, showing that the active maintenance of supply order considerations will help the industrial supply in the second quarter of the overall demand is not clear, will not rise significantly.

Fourth, data center operators as of the first quarter inventory level is still only about 10 weeks, and it is expected that the third quarter will eventually replace inventory, which will drive DRAM demand.

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