DRAM prices surge
Prices for DRAM and SSD to go up
During the last few months prices for DRAM modules have skyrocketed by 130-180% depending on manfacutrer. DRAM modules are found in every reasonably expensive electronics device, be it a smart phone, a car's onboard computer, laptops, desktops, even in fridges these days. SK Hynix, Samsung and Micron share almost all of the global DRAM manufacturing.
The high DRAM demand is caused by several factors.
- Datacenter competition between Cloud Service Providers (CSPs) for AI domination creates shortages.
- Samsung and SK Hynix is to join OpenAI's Stargate Initiative to advance global AI infrastructure will consume up to 40% of annual global DRAM output.
- Manufactureres have been cutting supplies to deal with the effects of the covid overstock leaving them unprepared for the sudden demand.
Consequently, this leads to profit prioritization in which suppliers shift production capacity towards high-margin server applications, impacting the consumer segment with price increase.
A price increase is to be expected in NAND Flash market as well. Surging cloud computing and storage demand, coupled with traditional HDD capacity bottlenecks, drives strong enterprise SSD adoption. AI server and HDD replacement demand sustain price uptrends.
Sources:
trendforce.com
openai.com
tomshardware.com
gamersnexus.com