DDR4 prices are going to increase by 25+ % this quarter

High demand for laptops has kicked off a new round of DDR4 pricing inflation cycle

We have unwelcome news that will further complicate PC building in these hard times. It seems that the rise in memory (RAM) prices, which is something that comes periodically every few years, has started again. Due to COVID, the demand for laptops has increased and there is lack DDR4 memory on the market. As a result, the prices are rising, and desktop memory is expected to get 25 % or more expensive by the end of this quarter, compared to Q1 2021.

Fraphics cards are overpriced, processors from AMD are unavailable, we have looming shortage of ubiquitous Realtek network controllers and audio chips, without which the production of motherboards can be delayed or halted, and there could even be problems with storage drives. Unfortunately, bad news is also coming from the RAM sector. RAM modules for computers will become more expensive (and this will also make the devices with factory-integrated RAM more expensive).

According to TrendForce analysts, who are monitoring the memory market, the increase in the cost of RAM can already be observed in contract pricing. Computer manufacturers and other consumers of DRAM chips have increased their production plans, which was not foreseen by previous market outlooks – for example, demand for laptops has risen sharply due to the COVID pandemic and home office & study.

This has created a situation in the market where the supply of DRAM such as DDR4 is insufficient. Due to the law of supply and demand, the price that the manufacturers of computers (or even separate memory modules) pay to chip manufacturers naturally rises. In a situation where there’s excess of demand over supply, a individual buyers compete for the limited resource by offering  higher price, while in a situation where supply is stronger than demand, producers compete for a customer by lowering pricing.

How high will these price hikes get? TrendForce says they’re now expecting PC memory price to go up by 23–28% in Q2 compared to average prices in the first quarter. They think the area of PCs will probably be affected by the increase in prices the most, out of various market sectors. The prices of server memory modules are supposed to grow as well significantly, albeit slightly less harshly. In Q2 2021, the expected increase is 20 to 25% for them.

It is likely that the pricing inflation will continue even in Q3 and will naturally be cumulative with increases happening in Q2. So if you’re currently considering a RAM capacity upgrade, it might be advisable to speed up your purchase rather than waiting for the second half of the year.

The news is not pleasant, as pricing inflation cycles often last for a long time, the prices keep increasing for several quarters until production is increased or the excess demand market condition ends for other reasons.

However, there is probably no danger of a GPU-like scenario with RAM sticks, meaning that they would not become completely available in retail stores. Fortunately, the volume of this market is significantly larger and therefore the imbalance should not have as drastic effects as with the graphics cards. So we will likely see just the price increase and not worse.

Source: TrendForce, via: techPowerUp

Translated, original text by:
Jan Olšan, editor for Cnews.cz


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