Mobile DRAM prices to rise 3% in 1Q18

Mobile DRAM contract prices will rise a mere 3% sequentially in the first quarter of 2018, according to DRAMeXchange. Despite the recent launch of new full-screen smartphones, consumers have been less willing to make purchases resulting in lower-than-expected mobile phone sales.
 
Besides, as rising mobile DRAM prices over the past year erode their profitability, major smartphone brands have moved to adjust their production plans and defer their restocking since the middle of fourth-quarter 2017, DRAMeXchange indicated.
 
Inventory of mobile DRAMs and other key components for mobile phones has already piled up at major smartphone brands, DRAMeXchange noted. Mobile DRAM inventory at some brands has even doubled from the previous level discouraging them from restocking.
 
Mobile DRAM contract prices may not be finalized until the end of January as negotiation between suppliers and buyers has taken a longer period of time, DRAMeXchange said. The price tracker now expects mobile DRAM prices for the first quarter of 2018 to rise only 3% sequentially, compared with the 5% growth estimated previously.
 
Mobile DRAM contract prices are expected to remain stable or rise slightly in the second quarter of 2018, according to DRAMeXchange. Demand for smartphones is expected to pick up in the second quarter thanks to the roll-outs of new Android flagship models.
 
In addition, DRAMeXchange expects the global supply of mobile DRAMs to stay constrained during the first half of 2018, as new output from Samsung's Pyeongtaek plant will not be launched until the second half of the year.

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