DRAM prices are moving up dramatically in last few days. Why? My 2 cents worth:
(1)There is continuing PC demand. Low end PCS come with 32 MB RAM but there is strong demand, even i Q2, a weak quarter, traditionally
(2) No major manufacturer has inventory.
(3) Most important: because of anti dumping ruling, no off shore manufacturer can sell 64 MB chip below $8 in USA. They stopped selling in USA 5 weeks ago. Only DRAM made in USA can be sold at less than $8 per 64 MB chip.
(4) US made 64 DRAM is not sufficient to meet demand in USA. So the prices have to rise around $8 before stabilization.
(5) No more new capacity has been added or will be added in any foreseeable future. Everybody has taken huge losses in last 3 years.
(6) Q3 and 4 mean more PCs being manufactured and more demand with same supplies.
(7) With K-7 and Merced arriving, more DRAM per PC and again turn over from old Pentiums to new PCs in 2000-2002.
Memory prices will keep on going up. Dan Niles is not a fool, when he said Micron could be $200 stock next year. Fundamentals are in place for dramatic up turn in DRAM prices. Takes 2 years to plan and commission new FAB to make more DRAMs.
64 MD DRAM spot price: US $6.00 7-15 in Taiwan,5.75 7-14, 5.50 7-13, 5.10 7-12, 5.00 5-09, 4.75 5-08.
Stay tuned !!! |
