Persistent shortage squelches DDR2 eTT price fluctuation

Month-end financial pressures continue pressuring DDR2 spot prices trending downward. DRAM at contract market, on the contrary, is likely to maintain its firm pricing through Nov on buoyant NB shipment among OEM makers.

Those distributors who dumped their DDR2 stocks in large volume due to the month-end financial pressure slashed spot prices last week. DDR2 512Mb eTT had once dropped as most as 6.7% to sub-US$5 level and branded 2.1% to US$5.97. Demand, somehow, was stimulated once eTT prices edged below US$5, reflecting marketers' general optimistic outlook for retail market sales after Nov. With the continual price drop of branded DDR2 chips further narrows down (Figure 2), market price has resumed to normal. DRAMeXchange projects that the recent price fall of DRAM spot prices may weaken on the anticipated firm contract price trend.

DRAM contract prices, on one hand, are sustain by 4Q seasonality demand upturn. Those US PC OEMs who strive for shipment boost prior to fiscal year end during Oct further encourage sales on the other hand. Some PC OEMs who attempted to lower DRAM content per box to meet shipment goal failed upon the persistent shortage. Built on the anticipated firm NB shipment in Nov, DRAM contract prices should maintain strong.

Rumors judge NAND Flash price trend

After experiencing three consecutive weeks' price correction, NAND Flash spot prices start showing rebounding sign on numerous rumors.

Rumors concerning this rebound circulate among marketers without any of these could be testified. Some attributed the rebound to Apple's orders shift from Toshiba to Samsung and Hynix due to production issue at Toshiba while some said Apple sees ramping up orders for new iPod. Some even suggested that a leading memory card vendor places considerable orders. Although none of these speculations could be testified at the moment, the industry that fills with positive atmosphere puts price correction of 2Gb, 4Gb and 8Gb NAND Flash on a hold.

Price trend of NAND Flash do not supply any concrete hint to foretell future trend in Oct. The bullish price trend that once existed in Sep prompted marketers generally believing a better off outlook in Oct. However, price fall after the week-long holidays in early Oct on the speculated unsatisfactory iPod sales, MLC controller IC issue of a certain NAND Flash supplier and downstream players' month-end financial pressures misted outlook.

Price drop pressure of all mainstream NAND Flash chips weaken last week with some chips' prices even start trending upward. Price of 2Gb enjoyed the highest growth of 1.8% and closed at US$5.08; 8Gb followed with a growth of 1.3% at US$15.25; 4Gb remained flat at US$7.92; prices of 1Gb and 16Gb each dropped by 1.1% and 1.5% and closed at US$2.71 and US$32.22 respectively.