RAM Prices set to Drop in 2019 Thanks to Oversupply

The last two years have been a nightmare for PC builders in terms of graphics card shortage and RAM prices. Luckily for us, the supply has finally been met and seemingly surpassed demand in the GPU market, leading to much needed drop in prices to the point where cards are actually being reasonable.

Unfortunately, the same can’t be said for the DRAM market. Prices are still sky high, but don’t worry too much longer because if this latest report is correct, we could see a huge drop in prices by next year.

RAM Prices to crash Next Year According to Industry Sources

As reported by DigiTimes, Micron Technology has ramped up their RAM production followed by new players in the market, including China-based Fujian Jin Hua Integrated Circuit and Innotron Memory (previously known as Hefei ChangXin). According to DigiTimes sources, this could lead to oversupply for the memory in 2019.

Not only that, but reportedly Samsung and SK Hynix both believe that the booming memory market will likely be over by the end of this year. Even with this knowledge, at their investors conferences, both companies claim that they will continue to ramp up their memory production moving forward.

So basically, with oversupply and less demand, RAM prices could come tumbling down to a level we haven’t seen in years. DigiTimes states in its report:

The global DRAM market is expected to reach a peak of US$104 billion in 2018, before contracting by 1.8% and 2.6%, respectively, in 2019 and 2020, according to an industry estimate. Meanwhile, automotive applications will gradually replace the smartphone sector to become the largest market for memory chips.

Samsung’s share in the DRAM market continues to decline after hitting a high of 50.2% in the third quarter of 2016 thanks to rivals including Micron that have grown their revenues and profits. Samsung has its share dropped to 44.4% in the first quarter of 2018, while Micron managed to increase it to 23.1%, according IHS Markit.

Micron is already preparing to expand production of 10nm DRAM chips at its Taiwan-based fabs between 2018 and 2019. As a response, Samsung will kick off volume production of its 10nm LPDDR 5 chips at its factory site in Pyeongtaek in 2019. The Korean giant is also gearing up for 3nm fab construction in 2020.