Spot market DRAM prices fall in China
High inventory levels and weak demand mean DRAM prices are dropping in China
By Jim Carbone -- Purchasing, 9/17/2008 10:40:00 AM
Now is the time to buy dynamic random access memory (DRAM) chips in China, according to researcher iSuppli, which says that prices are failing because of weak demand and high inventory levels, On the spot market, the average price of a 1 gigabit (Gb) double data rate 2 DRAM fell by 18% during the first week in September, according to the researcher, who sees prices continuing to fall for the rest of the month.
China had been hoping for an economic boost from the Summer Olympics, but for the nation’s DRAM market, the event actually had the opposite effect as there was a decline in demand during the games.
“The games clashed with the traditional summer promotional season for PCs in China, with many consumers glued to their TVs and absent from stores,” says John Lei, memory ICs and storage systems analyst for iSuppli. “This caused sales momentum to slow. Furthermore, all the IT (information technology) equipment required for the Olympics was purchased years before the event, meaning there was no Olympic boost for DRAM demand.”
He believes DRAM demand will recover as another round of computer buying kicks in. Most of the construction of national IT facilities in China had been completed prior to the Olympics and most PCs now in use at these operations are at least two to three years old. These systems will need to be replaced or upgraded, Lei says, which will mean increased demand ahead for DRAM and other semiconductors.
Also see: DRAM prices to fall 10% in third quarter
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