4GB DDR4 contract prices to rise 12.5% in 2Q17, says DR…

Average contract prices for 4Gb DDR4 modules will rise to US$27 in the second quarter of 2017 from US$24 in the first quarter, a 12.5% increase, according to DRAMeXchange.

Contract prices for 4GB DDR4 modules have risen by more than expected in the second quarter, said DRAMeXchange. The supply is running short of demand more severely, due to quality problems with products made using sub-20nm process technologies, according to DRAMeXchange.

“PC OEMs that have been negotiating their second-quarter memory contracts initially expected the market supply to expand because Samsung and Micron have begun to produce on the 18nm and the 17nm processes, respectively,” said Avril Wu, research director of DRAMeXchange. “However, both Samsung and Micron have encountered setbacks related to sampling and yield, so the supply situation remains tight going into the second quarter and PC DRAM prices will continue to rise through this three-month period.”

Samsung has started mass producing 18nm PC DRAM products since the middle of first-quarter 2017. Transitioning to a more advanced manufacturing technology tends to create difficult design challenges, and Samsung has found that some of its memory modules are having compatibility issues with certain notebook platforms, DRAMeXchange identified. The high defect rate from the 18nm process has hindered the supplier’s shipments.

Micron Technology has also started sending its 17nm PC DRAM products to clients for sampling since the first quarter, but the entire process is taking much longer than expected, DRAMeXchange said. Micron will likely delay its mass production schedule for chips built using 17nm process technology beyond the second quarter.

“Samsung’s and Micron’s predicaments reveal that design and manufacturing barriers become a lot higher when it comes to migrating to under-20nm production,” Wu continued. “At the same time, such migration efforts result in diminishing returns in the form of shrinking bit growth. Significant improvement in the market supply situation therefore is expected to come much later.”

In addition, average contract prices for server DRAM products are projected to increase 10-15% sequentially in the second quarter of 2017, while prices for mobile memory products will rise less than 5% on quarter, according to DRAMeXchange. “The moderate price uptick for mobile memory products is mainly attributed to slowing shipments from China-based smartphone makers,” said the price tracker.

Categories: Bits + chips Memory chips

Tags: 2Q17 4Gb contract market DDR4 DRAM DRAMeXchange Hynix manufacturing Micron product

Related stories
• DRAM spot prices hit 18-month high, says DRAMeXchange (Feb 3)
• DRAM contract prices rise to US$18 in November, says DRAMeXchange (Dec 7)
• DRAM contract prices rise over 20% in October, says DRAMeXchange (Nov 3)
• DRAM contract prices to rise nearly 30% in 4Q16, says DRAMeXchange (Oct 4)
• DRAM spot prices hit 7-month high, says DRAMeXchange (Sep 30)