The Rise of Memory Prices: DRAM and NAND’s Market Comeback in 2024
According to the latest market research by TrendForce, the contract prices of DRAM products have been declining since the fourth quarter of 2021, enduring a continuous drop over eight quarters. However, a rise is anticipated beginning in the fourth quarter of 2023. As for NAND flash memory, the contract prices started to fall from the third quarter of 2022, witnessing a consecutive decline for four quarters until an increase from the third quarter of 2023. Given the conservative outlook for market demand in 2024, the price trends of both DRAM and NAND flash memory will largely depend on the capacity utilization rates of suppliers.
In the first quarter of 2024, DRAM contract prices are expected to see a quarterly increase of approximately 13 to 18%, while NAND flash memory could experience a rise of 18 to 23%. The market’s outlook for overall demand in the second quarter is conservatively tilted. Suppliers of DRAM and NAND flash memory adjusted their capacity utilization rates from late in the fourth quarter of 2023 to the first quarter of 2024. Buyers are also progressively replenishing their inventories in the first quarter, which is likely to reduce the quarterly increase in contract prices for DRAM and NAND flash memory to 3 to 8% in the second quarter.
The third quarter, traditionally a peak season, is expected to witness strong replenishment momentum from North American cloud service providers (CSPs). With the capacity utilization rates of DRAM and NAND flash memory yet to return to full capacity, the quarterly increase in contract prices is projected to expand synchronously to 8 to 13%. This expansion in DRAM will be driven by an increase in the average unit price due to the rising penetration rates of DDR5 and HBM. In the fourth quarter, assuming suppliers maintain effective capacity control, this upward trend is expected to continue, with DRAM contract prices likely to see a quarterly increase of about 8 to 13%, and NAND flash memory at 0 to 5%.
