Spot prices for DRAM mainstream DDR 256Mb (32Mbx8) 400MHz picked up moderately to US$2.53 on September 6, up from US$2.46 that recorded on September 1. DDR 512Mb (64Mbx8) chips were traded at US$5.95, reversing a three-month upward trend that recorded during June to late August (US$4.67 on June 1 to US$6.11 on August 23). DDR2 512Mb chips were traded within a narrow range of US$5.23-$5.25 for the past month. eTT 256Mb (32Mbx8) has reached US$2.28, rebounding from US$2.24 on August 29 . Prices for SDRAM 4Mx16 chips and 1Mx16 chips were flat at US$1.1 and US$0.7, respectively.

Spot prices slip in August because most traders began to dump their inventory they had built since May, when DDR 256Mb DDR prices were as low as US$2.3. Since early August, demands at the retail channels and at the PC OEMs have fell behind traders’ expectation. DRAMeXchange believes the DRAM upward momentum will keep moderate in September.

DDR and DDR2 contract prices may show mixed trend in 1H September

DRAMeXchange notes that the magnitude of DRAM makers’ capacity shift to DDR2 appears to be larger than the actual amount needed at the end market. The DDR supply, on the other hand, has been remained tight since May because of the capacity shift.

With the different supply-and-demand scenario between DDR and DDR2, contract prices for these two chips will show a diverse trend. Most DRAM makers are planning to raise DDR prices by at least 2% -3% for the first half of September, but they are lowering prices for DDR2 modules, especially to customers with higher DDR2 exposure.

Some DRAM makers have been requested by their customers to slow DDR2 capacity shift to meet their demand for DDR. However, some DRAM makers are not slowing down their pace, hoping further reduce DDR2 cost through larger production scale. Also, they believe DDR2 demand will materialize in the fourth quarter.

By Judy Chen, Marketing Intelligence Team, DRAMeXchange