Market analysis: RAM and SSD prices could rise

Falling prices for SSDs and RAM will soon be a thing of the past – at least according to the market analysts at Trendforce. As the market research institute states in a press release, the prices for memory began to plummet due to falling demand for these products. Coupled with the developments of the past few months, which Trendforce counts the effects of rising inflation, the Russian-Ukrainian war and the Corona policy, the inventories of the manufacturers have therefore remained significantly larger than planned.

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In response, Micron, one of the world’s largest semiconductor manufacturers, announced last week that it would scale back production of DRAM and NAND memory, becoming the first top-tier company to do so. The Japanese group Kioxia followed shortly thereafter with the announcement that it would reduce the production of NAND memory by 30 percent. According to Trendforce, the market situation here is even more difficult than for RAM: The main reason for this is falling contract prices for the production of wafers for the mass market, which, according to the research institute, means that the manufacturers are sometimes even facing a loss.

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According to Trendforce, it cannot be ruled out that other manufacturers will follow suit and also shut down production. According to the analysis, only a “large-scale production cut could reverse the imbalance between supply and demand” in 2023. In this case, it could be the end customer who suffers, because if there is a shortage of supply, they will no longer be able to benefit from the low prices of recent months and will have to adjust to higher costs when purchasing memory again.

The reduced production of the two memory cells could also affect future memory standards, as Trendforce suspects. In 2023, Micron will continue to focus its capacities on 176-layer NAND instead of ramping up the production of 232-layer NAND as originally planned. Micron had already started manufacturing the 3D NAND flash with 232 layers in July 2022 and is particularly relevant for upcoming PCIe 5.0 storage – corresponding NVMe SSDs, which are particularly suitable for the recently introduced Ryzen 7000 and Intel Raptor Lake systems are becoming important, so they could be more expensive than initially expected at market launch.

Source: trend force