Spot market transaction gradually warmed up from two working days ago and we remain positive to the pricing trend of next week. In contrast, DRAM spot market trading was sluggish in the first half of the past week. The main reason is that buyers was waiting for lower trading price and sellers thought DRAM spot price would rebound in the short term.

Because of seasonal demand, major motherboard makers estimate that their shipments will grow in September and October in month over month basis. DDR SDRAM module trading is more active in the spot market last week. We predict that some PC ODMs recently start increasing their inventory level. In the second half of September and October, we are optimistic to spot pricing trend.

The average price of DDR SDRAM 32Mb*8 400MHz ranged from $4.3 to $4.37 during the past week. Buyers have pressure to prepare higher inventory level for the coming holiday demand. After releasing their inventory to normal level, DRAM vendors intend to push up DRAM price. During the second half of September and October, DRAM vendors will have more bargaining power than buyers.

According to historical experiences, spot price crossed over contract price as spot price rebounded and formed an uptrend and then the coming contract price would have more opportunity to rally. At this moment, spot price continues to rally so contract pricing will have less chance going down next week. Comparing to lower spot price, contract price will be stable or a little bit up in the second half of this month.

Flash 1G and 2G are most active items in flash spot market during the past week. We forecast that flash spot price remain stable next week.

DRAM spot prices - 2004/9/7~2004/9/14