| DRAMeXchange> Weekly Research> DDR prices bounded up with limited supply remains |
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【Market View】DDR prices bounded up with limited supply remains
Published
Jan.20 2004,17:57 PM (GMT+8)
DDR prices bounded up with limited supply remains
The January 6- 9 upturn momentum in the spot market is quite strong and the daily performance has been up 14 cents (US$) from $3.86 to $4.0 for DDR 256Mb 32Mx8, even beats the uptrend happened in last October. Around then, the strongest momentum were on 10/23 to 10/27, from $4.40 to $4.49 to $4.58, 9 cents up a day. However, this up-steam didn’t last long for one week and turned softer since January 12 as some channel traders released the parts to the spot market for profit taking. We were conservative about the pricing performance on last issue and projected the DDR prices may go further down. It turns out that the marketers observe the limited supply in the spot market may remain for a while and are willing to take a chance to hold inventory to the end of Chinese New Year for possible rising prices. DDR 256Mb 32Mx8 prices reached lows on January 14 and bounded up for consecutive 3 days. The bounding almost recover the loss since January 9. In conclusion, DDR400/333/266 MHz are down 0.75%, 1.55%, 1.59% respectively for last week. According to our survey, channels are optimistic about the pricing trend and decide to hold and see how’s going after the Chinese New Year. In recent two days, transactions are slow and the offers are limited, some vendors even stopped offer in the late afternoon.
Market views from different parties
What interesting is, we have checked with different parties and found out they hold different view of the future market. Simply, the channel traders hold the most optimistic view and believe this uptrend will go further and last longer. Certain PC OEMs are worried about if the uptrend keeps going, their cost on DRAM will increase but they still hesitate to pile up their stocks at current low seasonal demand even though we have confirmed Dell and HPQ have increased their DRAM booking in 2H December. We believe PC OEMs hold different policies at current time, some may plan to increase their booking and some may adjust their procurement strategies until they get a clear picture. As for DRAM makers, most of them still work hard to move their output to customers. Definitely, if the prices keeps going up, DRAM makers will be the party benefits most. However, it seems they are the parties hold the most conservative view of the pricing upturn momentum in the spot market. Even spot prices performed well and crossed over the 1H January contract prices, most DRAM makers still feel tough to raise the contract prices to the level they desire.
2H January contract prices rise slightly
After a struggling negotiation, DRAM makers finally raise the 2H January contract prices up a bit as they wish. The lows and highs on DDR 256MB are up slightly 1.61% and 1.54% respectively.
  
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