Pricing trend
Because of Typhoon Aere swept through Taiwan last week, the Taiwan's DRAM spot market was off on August 24, 25. The trading volume in Asian market was quite low during those two days. Most DRAM traders and channel distributors only checked prices and stayed aside.
The market momentum turned stronger in the afternoon of August 26, Hynix 32Mx8 256Mb rose to $4.45 from $4.3 quoted in the morning and UTT ( untested ) memory chips jumped to $3.98 from $3.88.
As of today, August 31st, we observed the Hynix DDR 32Mx8 266MHz chips were traded at $3.95, even below the prices for UTT chips at a range of $3.98 to $4.04. Also, the lag between 400MHz and 333MHz enlarged with a heavy dumping by Chinese marketers as they expected a pricing weakness at the month end.
According to our checking with channels and PC OEMs, we project DRAM prices will go on a modest uprising track. However, we are not so optimistic to expect a strong rally in DRAM pricing in September/October by simply looking at the seasonal motherboard/CPU/Chipset uptick in August. We believe the increasing DRAM supply in the third quarter would limit the upside of DRAM prices.
Still, we believe the DDR 256MB contract prices will most likely remain flat or possibly rise slightly. We expect some PC OEMs will increase their DRAM procurement quantity, however, it could be tough for DRAM makers to raise the contract prices since their inventory pile up and there's only one month left to the peak demand.
Inventory level
We believe most PC OEMs still hold low inventory level as they are cautious about the DRAM pricing trend and an imminent increasing in DRAM supply. We believe most PC OEMs will increase their DRAM procurement quantity in the first half of September to meet the seasonal demand.
As for channels, even though we have heard DRAM manufactures were stuffing more chips to channels from mid- July to early August as some module houses announced their inventory level has increased to 3-4 weeks. We believe most of the excess inventories should have been worked off, driven by stronger demand in USA and European markets.
List 1 DRAM spot prices
| 2004/8/24 | 2004/8/25 | 2004/8/26 | 2004/8/27 | 2004/8/30 | 2004/8/31 | Change | |
| 256Mb 32Mx8 | |||||||
| DDR400 | 4.38 | 4.38 | 4.43 | 4.49 | 4.51 | 4.47 | 2.05% |
| DDR333 | 4.25 | 4.25 | 4.32 | 4.32 | 4.30 | 4.26 | 0.24% |
| DDR266 | 4.05 | 4.05 | 4.13 | 4.13 | 4.08 | 4.00 | -1.23% |
| SDRAM | |||||||
| 1Mx16/166 | 0.72 | 0.71 | 0.70 | 0.69 | 0.67 | 0.66 | -8.33% |
| 4Mx16/166 | 1.73 | 1.72 | 1.71 | 1.69 | 1.67 | 1.58 | -8.67% |
| 8Mx16/133 | 3.86 | 3.84 | 3.83 | 3.82 | 3.83 | 3.82 | -1.04% |
| 16Mx16/133 | 4.40 | 4.40 | 4.42 | 4.40 | 4.44 | 4.40 | 0.00% |
| 16Mx8/133 | 4.11 | 4.09 | 4.08 | 4.08 | 4.08 | 4.08 | -0.73% |
| 32Mx8/133 | 4.38 | 4.38 | 4.36 | 4.35 | 4.36 | 4.35 | -0.68% |
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