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DRAM Contract Prices for Q2 Adjusted to a 13–18% Increase
May 7, 2024 | TrendForceEstimated reading time: 1 minute
TrendForce’s latest forecasts reveal contract prices for DRAM in the second quarter are expected to increase by 13–18%, while NAND Flash contract prices have been adjusted to a 15–20% Only eMMC/UFS will be seeing a smaller price increase of about 10%.
Before the 4/03 earthquake, TrendForce had initially predicted that DRAM contract prices would see a seasonal rise of 3–8% and NAND Flash 13–18%, significantly tapering from Q1 as seen from spot price indicators which showed weakening price momentum and reduced transaction volumes. This was primarily due to subdued demand outside of AI applications, particularly with no signs of recovery in demand for notebooks and smartphones. Inventory levels were gradually increasing, especially among PC OEMs. Additionally, with DRAM and NAND Flash prices having risen for 2–3 consecutive quarters, the willingness of buyers to accept further substantial price increases had diminished.
Post-earthquake, the market heard scattered reports of PC OEM suppliers accepting significant increases in DRAM and NAND Flash contract prices due to special considerations, but these were isolated transactions. By late April—after a new round of contract price negotiations were completed—the increases were larger than initially expected. This pushed TrendForce to revise upward Q2 contract price increases for both DRAM and NAND Flash, reflecting not only the buyers’ desire to support the value of their inventories but also considerations of supply and demand prospects for the AI market.
TrendForce reports that manufacturers are wary of potential crowding out effects on HBM capacity. Specifically, Samsung’s HBM3e products, which utilize the 1alpha process node, are projected to use about 60% of this capacity by the end of 2024. This substantial allocation is expected to constrict DDR5 suppliers, particularly as HBM3e production significantly increases in Q3. In response, buyers are strategically increasing their stock in Q2 to prepare for anticipated HBM shortages beginning in the third quarter.
As energy efficiency becomes increasingly crucial for AI inference servers, North American CSPs are adopting QLC enterprise SSDs as their preferred storage solutions. This shift is boosting demand for QLC enterprise SSDs causing rapid inventory depletion among some suppliers and making them hesitant to sell. Additionally, due to the uncertain recovery in consumer product demand, suppliers are generally conservative about capital investments in non-HBM wafer capacities, particularly for NAND Flash, which is currently priced at the breakeven point.
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Samsung Electronics Begins Industry’s First Mass Production of 9th-Gen V-NAND
04/29/2024 | Samsung ElectronicsSamsung Electronics, the world leader in advanced memory technology, today announced that it has begun mass production for its one-terabit (Tb) triple-level cell (TLC) 9th-generation vertical NAND (V-NAND), solidifying its leadership in the NAND flash market.
AI Demand Drives Rapid Growth in QLC Enterprise SSD Shipments for 2024
04/23/2024 | TrendForceNorth American customers are increasing their orders for storage products as energy efficiency becomes a key priority for AI inference servers. This, in turn, is driving up demand for QLC enterprise SSDs.
Q2 NAND Flash Contract Prices Expected to Rise by 13–18%, Enterprise SSDs to See Highest Increase
03/29/2024 | TrendForceTrendForce projects a strong 13–18% increase in Q2 NAND Flash contract prices, with enterprise SSDs expected to rise highest. Despite Kioxia and WDC boosting their production capacity utilization rates from Q1 this year, other suppliers have kept their production strategies conservative.
Kioxia, WD Elevate Capacity Utilization, Pushing NAND Flash Supply Growth to 10.9%
03/19/2024 | TrendForceTrendForce reports that anticipation of NAND Flash price hikes into Q2 has motivated certain suppliers to minimize losses and lower costs in hopes of returning to profitability this year.
NAND Flash Industry Revenue Grows 24.5% in Q4 2023, Expected to Increase Another 20% in Q1,
03/06/2024 | TrendForceTrendForce reports a substantial 24.5% QoQ increase in NAND Flash industry revenue, hitting US$11.49 billion in 4Q23. This surge is attributed to a stabilization in end-demand spurred by year-end promotions, along with an expansion in component market orders driven by price chasing, leading to robust bit shipments compared to the same period last year.