Dynamic random access memory (DRAM) chips started the new year with a bang, with prices of Double Data Rate 2 (DDR2) memory chips rising due to tight supplies of the chips. The spot-market price of the most actively traded DDR2, 512Mbit chips that run at 533MHz, rose by 22% by late January to $4.59 each, up from $3.75 at the start of the year. DRAMeXchange Technology, which runs an online clearinghouse for the chips, says prices are expected to continue to remain strong throughout the first quarter of 2006.

Look for price tags to slide by 4% this year for rechargeable lithium batteries. Market prices for lithium cells have fallen about 4% over the last three years. The declines have occurred although the price of cobalt—a key material in lithium cells—has risen. Lithium cell manufacturers absorbed the costs rather than passing them on to buyers.

Apple Computer's first desktop personal computer based on an Intel microprocessor carries a bill of materials (BOM) of $873 and $25 in manufacturing and test fees, according to iSuppli. The market researcher dissected the new Apple iMac desktop PC that was introduced at the recent MacWorld Expo. The computer uses Intel's Core Duo microprocessor, a dual-core chip.

Market researcher iSuppli expects average prices of mobile telephones to drop by 9% in 2006 to $129 from about $142 in 2005. Costs are declining, but so are purchases. Annual per-unit sales peaked at 30% growth back in 2003 but have been sliding since—with less than 5% expected in 2006. As a result, iSuppli cell phone factory revenue will decline almost 5% in 2006 to $109.7 billion from $115.1 billion in 2005.

With the cost of NAND flash declining at 40% annually, new applications are expected to open up in computing. This year, Samsung will launch 8-gigabit NAND flash, next year 16-Gbit and, in 2008, it is expected to introduce 32-Gbit—without raising prices. "Every 15 months you get double the memory for the same price," Richard Walsh, senior memory manager for Samsung in Europe, tells sister publication Electronics News. "It opens up lots of applications."

The average price of U.S.-mined thermal coal, the type burned at power plants, is expected to rise 15% this year, according to analyst David Khani at Friedman, Billings, Ramsey & Co. Depending on grade and location, that could mean an increase of roughly $2 ton for lower-grade coal, to a price near $17 ton, and an increase of roughly $10 ton to about $69 ton for higher-grade coal.

Energy prices will remain elevated throughout 2006 before moderating in 2007, the Energy Department says in its latest short-term outlook. The new forecast puts the crude oil price average at $63 a barrel in 2006 and projects it to fall to $60 in 2007. That's too low, says Jeff Rubin, chief economist at CIBC World Markets, who believes North American crude oil prices will surpass $70 this year and close in on $100 in 2007. Rubin is very concerned about supply, shown to be vulnerable last year when the major oil infrastructure in the Gulf Coast was pounded by two major hurricanes.

Although weekly copper prices have risen 50% in the past year, Citigroup's metals analyst rejects other inflated future-price forecasts. World copper cost $1.67/lb last year and the latest consensus forecast is slight slippage to $1.66 this year. John Hill, though, expects copper prices to go sharply lower in coming quarters, "as worldwide demand moderates and supplies increase." Hill writes: "Our global forecast is for copper prices to decline by 17% in 2006 to $1.375 pound." He reckons the copper market is in the process of swinging from deep deficit to surplus.

Sonoco Products will eliminate recently enacted energy surcharges and, instead, try to boost prices by $30-$40 ton, depending on grade, on its North America uncoated recycled paperboard. Recycled paperboard production slipped last year in the face of lower demand. A coated recycled paperboard price hike tried by supply leader Caraustar Industries last autumn didn't stick. However, Sonoco says its increases are necessary to help offset inflation in raw materials costs, supply items and other production items.