Covid-19 likely to send memory prices, markets down

March 16, 2020 //By Peter Clarke
Covid-19 likely to send memory prices, markets down
The economic impact of the Covid-19 pandemic is likely to send the memory market into a slump in the second half of 2020, according to market research firm TrendForce.

The situation differs slightly between the DRAM and NAND flash portions of memory, TrendForce said. The average selling prices (ASPs) will likely hold firm for the 2Q20 due to the low levels of inventory present at clients but the lowered demand for electronic products will bring about a corresponding drop in demand for memory components in 2H20.

The result of sluggish demand will be limited growth for 2H20 memory prices and NAND flash prices possibly decreasing, TrendForce said.

TrendForce had been forecasting DRAM and NAND flash price growth up to the end of 2020 and limited unit supply growth of 13 percent and 32 percent year-on-year, respectively.

DRAM and NAND Flash prices up to the end of the year, given that both products saw limited supply growth in 2020, at 13 percent and 32 percent YoY, respectively. Now TrendForce sees that a shortage of DRAM supply means that 2H20 DRAM prices will, at worst, exhibit limited growth rather than a decline.  But NAND Flash memory is available and as client-side demand falls NAND Flash prices may be expected to decline in 2H20.

For DRAM, TrendForce sees ASP increase in 2Q20, 5 percent sequential growth in 3Q20 and flatness in 4Q20. The result will be a full sequential increase of 20 percent.

For NAND flash memory the 2Q20 increase could be as low as 3 percent followed by flatness or a fall of 5 percent in 3Q20 and a 10 to 15 percent decrease in 4Q20. The net result will be a fall in NAND flash prices of 5 percent year on year.

Related links and articles:

www.trendforce.com

News articles:

Chip market declined 12% in 2019, says Gartner

Micron overtakes DRAM competition, avoids EUV

Memory prices set to rise as makers report disruption

Industry is putting the brakes on memory capex


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