System builders will be happy to hear that DRam prices, which fell steadily throughout August, will continue to drop during the third quarter of this year.
Market watcher iSuppli has predicted that the price erosion over the summer will increase in the short term as DRam manufacturers boost their shipments into a market with slack demand.
The analyst noted that it has maintained a negative DRam outlook since May, because of weak overall demand in the market, and will continue to do so for the coming months.
Prices for 256MB double data rate (DDR) SDRam dropped by five per cent in mid-August, with prices for those modules on the Asian spot market falling below $4 for the first time since January.
OEM prices also fell by three to five per cent in the first half of August. In contrast, during Q2 this year prices for 256MB DDR SDRam hit a high of $6.
"The recent spate of weakness comes after prices were stronger than expected in June and July," said Nam Hyung Kim, principal analyst at iSuppli.
"The major factor propping up prices during those months was a re-allocation of production by the top suppliers from DRam to other parts, such as NAND and Flash memory. As a result, shipments of DRam during Q2 from three of the top four suppliers were almost flat, and sometimes decreased. This resulted in higher-than-expected prices.
"The present declines are not surprising given that prices had remained high until the end of Q2."
Paul Stevens, integration business unit manager at distributor Memory Plus, said: "The market has been a bit flat of late but is starting to stabilise now. Prices are falling but the rate of decline is starting to slow. Once Intel starts shipping some of the processors whose prices it recently slashed, we should see some increase in demand."
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