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Dram Prices Decline While NAND Remains Unchanged

It looks like power outages are the only factor capable of stopping the flash market’s decline. DRAMeXchange mentioned in two reports this week that DRAM costs slumped nearly 10% in 2Q19 as supply continued to outpace demand; however, NAND prices remained unchanged, at least partly to a June power outage at Toshiba’s manufacturing plant that reduced amount enough for costs to remain fixed quarter-over-quarter.

The continued drop-off in DRAM costs doesn’t come as much of a surprise to anybody who has been looking for PC memory lately. A small bump witnessed after Japan limited exports to South Korea was temporary, based on DRAMeXchange, and wasn’t sufficient to overcome the essential oversupply problems he market’s experienced for several quarters now. Any manufacturing issues ensuing from Japan’s restrictions were minor in comparison with declining demand.

Those factors added to a commodity, server, and consumer DRAM price drop of almost 30%. DRAMeXchange noted that mobile DRAM was the exception, as a result of its slump was only about 10-20%. Server dram had it bad with a nearly 35% drop quarter-over-quarter. Those reductions led to a global DRAM income decline of 9.1% in addition to lower profit margins for Samsung, SK Hynix, and Micron.

The agency stated it expects DRAM prices to proceed to drop in the third quarter of 2019. Consumer demand is not likely to rise enough for suppliers to work by way of existing DRAM inventories, that means suppliers are likely to see additional price falls in the next quarter. Until consumer demand rises throughout several markets, from smartphones to PCs, flash memory pricing appears unlikely to stop its deterioration.

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