The long-awaited price rebound finally occurred in price negotiations in the first half of April, thanks to PC OEMs' inventory build-up for the high season and potential supply constraints.
Price of the mainstream 2GB DDR3 module has gone up about 3% to US$18, translating to US$0.99 per Gb. High-density 4GB module has also posted a mild gain to about US$34.50.
PC OEMs continue building up inventory for the back-to-school season. Although the average memory inventory among OEMs has reached about four weeks, they are still buying amid growing concerns about a potential wafer supply constraints. Given that memory only accounts for 4-5% of total bill-of-material (BOM) cost currently, PC OEMs can accept price increases.
On the supply side, some unexpected production issues at some vendors - including problems with equipment and wafer materials - have strained supply temporarily. Some OEMs have been unable to secure enough DRAM from certain vendors, and have had to source from other suppliers, which has contributed to the price increase.
The uphill price trend will sustain throughout April with average price to gain another US$1 or so in the later half of the month. Vendors should be able to raise price to about US$20 for 2GB modules in the near term without much bargaining. But once the price surpasses the US$20 mark, the upside momentum should weaken unless there is clear visibility in the PC market.