RAM pricing development: price dynamics of the Memory Market

Since last year, prices for DRAM have steadily increased. An end of this development cannot be expected any time soon, due to experts. We are looking at background and circumstances.

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According to news pages and forums, the main reason for this price development in the memory modules industry is the increasing demand, especially in the smartphone and server sector. New technologies such as AI (Artificial Intelligence), which could be relevant for future smartphone generations, require larger RAM capacity. It is the same case in other areas where more RAM is necessary due to progressing technologies, e.g. in games consoles, Smart TVs etc.

How to explain the current RAM price increase?

Ilona Kleiß, responsible for CompuRAM’s purchasing department, states: “The current market prices are the result of the present shortage of supply. Despite the increasing demand, the leading DRAM manufacturers do not adapt their production output. In fact, they focus on product improvement and process optimisation.”

She continues that, moreover, there is a shift of production towards significantly growing sectors, for example mobile devices, while the total production capacities remain stable. The current product shortage and its related price development in the DRAM sector are the result of this. Only one of the leading manufacturers signalises an interest in increasing production capacities – and thanks to the market dynamics, it is to expect that other manufacturers would follow. However, there is no specification of when an adaption of production output would be likely. Due to the complexity related to an increased production, it will take several months until the effects of a higher production volume have an impact in terms of price.

“In the end, we are just experiencing the typical market dynamics with a normal price development, steered by supply and demand,” summarizes Ilona Kleiß.



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