Prices of Low-Capacity DDR5 UDIMM See a Slight Rebound, but Quarter-End Performance Pressures May Cause Continued Market Volatility

Since the beginning of this month, emotional and aggressive pricing tactics in the spot market have noticeably decreased compared to the previous two months, with the overall market trending toward rationality. As prices for low-end channel resources gradually stabilize and quotes show slight increases, alongside emerging signs of a rebound in retail prices for branded DDR5 UDIMM, the channel market as a whole has begun to stabilize. This week, DDR5 UDIMM in the channel market were the first to see a slight price rebound. However, given that it is currently the end of the quarter, there is a possibility that some manufacturers may accelerate shipments to meet their performance targets, potentially leading to continued market volatility.

Additionally, industry manufacturers are attempting to raise DDR5 prices to repair and stimulate the market, but there are differing views on customers' willingness to absorb these higher prices. With SSD costs remaining persistently high, the overall industry market remains stable. In the embedded sector, while some individual manufacturers recently quoted lower prices for LPDDR products to chase sales volume, major memory manufacturers generally did not follow suit, resulting in very limited market impact. Recently, some smartphone brands have initiated phased restocking for the new quarter; however, with sustained high memory prices, the rising costs for phone manufacturers are becoming increasingly prominent. It is expected that the Q3 price negotiation cycle will be further prolonged.

Specifically:

Channel Market: After nearly a quarter of market adjustments, aggressive price-cutting by traders has decreased. Low-end channel resources have begun attempting to push up prices. Since the beginning of this month, wholesale retail prices for branded consumer DRAM products in the channel have stopped falling, with some DDR5 UDIMM showing a slow rebound trend. The channel market is gradually forming a price pattern characterized by stabilization amid fluctuations. This week, prices for 8GB and 16GB DDR5 UDIMM in the channel took the lead in seeing slight increases, while prices for DDR4 UDIMM and SSDs remained largely flat.

Server DRAM: Supply and demand remain continuously tight, with low fulfillment rates for RDIMMs from original manufacturers (OEMs), creating a normalized supply gap that continues to drive up both contract and spot prices for RDIMMs. CSPs and OEMs are increasing the proportion of 32GB/64GB DDR5 RDIMMs. Going forward, the price elasticity for 32GB/64GB DDR5 RDIMMs will be higher than that for larger-capacity 96GB/128GB modules. Contract prices for DDR5 doubled quarter-on-quarter in Q1 and rose by another 45% quarter-on-quarter in Q2. It is expected that the magnitude of contract price increases will significantly narrow in Q3 and Q4, shifting from strong surges in the first half of the year to a gradual rise at elevated levels.

Last week, some industry manufacturers tentatively proposed slight price hikes for DDR5 SODIMM. Regarding customer acceptance, China's Taiwan region PC OEM clients showed relatively stronger willingness to absorb the price increases. In contrast, the mainland China market saw fragmented pricing due to varying prices of secondary-tier resources, making the market somewhat chaotic. As prices for certain secondary-tier DRAM resources slowly declined, some memory manufacturers engaged in phased restocking to further optimize production costs for finished goods. These finished product solutions exhibit greater price elasticity, leading to price differences among schemes using different resources for the same product and capacity. Under the condition that mainland customers engage in comparative purchasing, raising prices becomes even more difficult. Consequently, DDR SODIMM and SSD prices remained unchanged this week.

Upstream Resources: Prices for Flash Wafers and DRAM resources remained unchanged.

Recently, LPDDR4X/5X prices have been relatively stable. However, they are still highly sensitive to changes in resource costs, requiring close monitoring of the price trends of newly sourced resources this month. Additionally, as the new quarter approaches, some smartphone customers have released a certain amount of restocking demand.Nevertheless, since embedded NAND prices remain persistently high, subsequent negotiations may involve a prolonged period of price haggling.