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DRAM prices will hit bottom in Q109, says IC Insights
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DRAM manufacturers may not see the financial benefits of the expected
rebound in memory device prices until the second half of 2009, but they
can take comfort from the latest forecast from IC Insights that claims
that prices will rise from 1Q09 onwards. The report forecasts that
prices will hit bottom, ending the precipitous year-on-year declines
due to the massive overcapacity and now weakening demand.
According to the market research firm, the DRAM market is forecast to decline 5% sequentially for 1Q09, to US$4.2 billion. Growth will start in 2Q09 with market reaching US$4.9 billion (17%), US$5.9 billion (21%), and US$6.8 billion (15%) to finish the year. DRAM sales in 4Q09 are forecast to be 63% higher than in 1Q09, though IC Insights noted that this would still equate to a 12% decline for the sector in 2009, compared to 2008. IC Insights forecasts the DRAM market to be US$22.3 billion, down from US$25.2 billion in 2008
This would seem to highlight the level of demand weakness rather than continued high levels of overcapacity. The impact on DRAM supply of expected bankruptcies and cuts in 200mm production already announced should limit bit growth, especially with the majority of DRAM producers short of cash for node migrations and expansions.
