Hush spot market after a rally in July

:: A conservate market sentiment either to consume stock or remain at the current inventoy level

After an uptick in July's spot and contract price, the second week of August is relevately hush. Owing to the sufficient inventory in the downstreams, plus, price at this moment is no longer attractive to the speculators, liquidity in the spot market seemed to be a sharply decline without the momentum. Nevertheless, we predict market performance for the coming week will remain at the current price level or demonstrate a mild inventory adjustment to stimulate a price surge. Here are good news from Europe and the States: demands from end-users are gradually emerging due to summer holiday which we observe from module procurements, and we believe the price still has chance to move up in terms of healthy inventory adjustment.

:: Demands on DDR400 MHz will be appearing

After the approach of mid-July, the spot price premium between DDR400 MHz and DDR333 MHz became insignificant. The main reasons leading to the petty price premium lie in the apparent price surge in DDR333 MHz in 1H July and the weak demand on DDR 400MHz. However, as Intel's chipset 848 will be launched in mid-August and the sales volume for chipsets supporting DDR400 MHz released earlier from VIA and SIS surges, we expect the demand on DDR400 MHz will be driven consequently, then price premium will happen again.

:: MB shipment continuously increases

According to our data points, July motherboard shipment has a 13% increase comparing with June's figure. Our current estimate on motherboard shipment in August over July remains at a 10% growth. Based on such strength, back-to-school demands this year is optimistically foreseeable and we continuously believe the price still has upside potential.