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【Market View】DDR is continuing to slip.....


Published Dec.16 2003,20:36 PM (GMT+8)

Weekly Market Info Update
DDR is continuing to slip and SDRAM turns stronger
 
DDR continues its downward trend
DDR slips to lows and market lacks momentum in the face of sluggish demand. Numerous market participants have been watching the decline in DDR in cyclical downside and pointing to it as a sign of weakness. We maintains that the DDR performance remain moderately down due to seasonal weakness and the constraint DRAM budget ratio of 5% to 10% of PC cost. According to our survey, the growth of memory installed per PC – so called “content per box” is not satisfactory and not in line with the growth of PC shipment because certain PC OEMs have reduced the memory installed in PC systems since August  due to higher DDR price around then and the increasing prices on LCD and flash memory caused of shortage later. In past week, DDR 256Mb 32Mx8 400MHz has been down 3.27% from $3.98 to $3.85, 333MHz is down  3.58%,  from $3.91 to $3.77 and 266MHz  is down 2.89% from $3.81 to $3.70. Of the same density, UTT is quoted $3.4 to $3.45 today.
 
 
 
SDRAM is back to its strong momentum
In contrast to the weakening DDR pricing performance. SDRAM is able to maintain its favorable stance with stronger demand, especially for 1Mx16 and 4Mx16. Contributing to this favorable sentiment is the boosting demand on consumer electronic appliances such as DSC ( digital still camera ), STB ( Set-up-box) and DVD etc. According to our research, the sales for DSC will be around 42.8 million units in 2003 and grow to 51.3 million units in 2004, with 19.9% YoY. As for STB which is equipped with Digital TV, the sales is to be 39.2 million in 2003 and projected to be 45 million in 2004, with 14.4% YoY. DVD, 47.9million in 2003 and 53 million in 2004, with 10.6% YoY. And the stronger demand has increasing the appeal of more output for SDRAM 1Mx16 and 4Mx16. According to our survey, certain DRAM makers already have plans to increase their SDRAM output in 2004, however, the allocation will depend on the market demand and the total output to the market then. 
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2H December Contract prices are projected down
We have projected 2% to 3% down on 2H December contract prices on last issue. However, after checking with DRAM makers and PC OEMs , we found the gap seems wide between DRAM makers and PC OEMs’ expectation. As now, most DRAM makers are expecting only 1% to 2% down while most PC OEMs are expecting further down around 3% - 4% or even more. Therefore, we believe it may take longer to have the prices finalized.
 
 
 
 
 
 
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