Memory spot price decline slows down and is expected to bottom out in Q1 next year

Industry insiders said that spot prices of DRAM and NAND flash memory continued to fall, but the pace has slowed down and are expected to bottom out in the first quarter of next year.

According to Electronic Times, the spot prices of mainstream 8Gb and 16Gb DDR4 chips fell by 0.7-1.5% in November, compared with an average drop of 7% in October. The spot price drop of 3D TLC NAND flash memory chips in November also slowed down compared with the previous month, and the prices of SLC and MLC NAND chips have stopped falling.

Sources pointed out that in order to keep prices stable, upstream chip suppliers are cautious about capacity expansion next year, allowing suppliers in the spot market to negotiate better prices. According to sources, the overall DRAM bit supply is expected to increase by about 5% in 2022.

At the same time, for profit considerations, chip suppliers are seeking to transfer more available production capacity for low-density commodity DRAM memory to the manufacture of CMOS image sensors, while starting DDR6 memory research and development.

The source said that while channel retailers and distributors remain pessimistic about the demand outlook for the first quarter of 2022, demand visibility is likely to become clearer after mid-February.

In the terminal market, the new 12th generation Intel Core processor family is expected to stimulate demand for PC applications starting next year. In terms of smartphones, it remains to be seen whether new 5G models next year will stimulate terminal market demand. In terms of servers, demand may start to pick up after mid-January 2022.