Major chip suppliers, including Samsung Electronics, Micron Technology, Toshiba and SK Hynix, which had been competing for Apple's orders for DRAM+NAND flash chips used in iPhone XS Max, are now worried about how to keep their memory production capacity occupied.

But they fight hard to not allow price reductions :-) Despite profits are now comparable to selling drugs.

Samsung Electronics, SK Hynix and Micron Technology - saw their combined DRAM and flash memory revenues drop 18% sequentially and 26% from a year earlier in the fourth quarter of 2018 due to seasonality and decreasing prices.

Their combined revenues from DRAM slipped 17% sequentially and those from flash memory dropped 20% in the fourth quarter. DRAM accounted for 70% of the top-3 vendors' combined revenues in the fourth quarter, a percentage similar to that of the previous quarter.

DRAM memory contract prices have fallen further in March, and are expected to continue their downward trend through the second quarter indicating PC OEMs and other chip buyers continue to gain bargaining chips when negotiating prices, according to industry sources.

Nevertheless, falls in the contract prices are expected to slow in the second quarter, said the sources. It is likely the prices will return to the levels two years ago, the sources continued.

China at the moment has as many as 30 semiconductor fabs under construction - the most ambitious investment plan the global semiconductor industry has ever seen. China's memory industry was originally meant to be a key growth driver, but it has lost momentum after the US ban on exports to China-based DRAM maker JHICC. On the other hand, China's wafer foundry sector continues seeing expansions with at least 13 local fabs eyeing business opportunities in the sector.

Hence the sudden move by cartel by fast lowering the DRAM prices. And most fun is that Chinese DDR4 modules assembly companies are now using it to wipe out competition at least in Asia.

Not lowering DRAM price was not possible as it could lead to massive tragedy with at least one of cartel members that could go underwater and Samsung also bleeding to death, as now cartel hopes that at least some of planned fabs will be moved to something else and it will save them.

Taiwan-based memory module firms basically intend to shift all their manufacturing lines for products exported to the US from China to Taiwan, while keeping those for products sold locally in China, the sources noted. However, none of the makers is expanding existing factory capacity in Taiwan

It will be also big tragedy for Taiwan memory module sellers, as Chinese companies are closing fast. They are already losing lot of orders in Asia and exUSSR areas due to 15-20% of price advantages as all Chinese memory makers are run on government money and do not need profits.

DRAM capital spending will fall 28% in 2019, due to economic and trade uncertainties, and softer demand keeping pressure on DRAM ASPs, according IC Insights.

One of the significant questions facing the IC industry in the second half of 2019 is if and when the DRAM market will rebound, IC Insights indicated. Any rebound in the market will be driven in part by available manufacturing capacity. After huge capex outlays for DRAM in 2017 and 2018, the question becomes how much new capacity will come online and how far DRAM prices (price per bit) will fall as a result of this buildup

The price of key memory chips has risen by more than 20 percent in just two weeks following Japan's restrictions on high-tech material exports to South Korea.

According to industry sources and market researcher DRAMeXchange, the spot price of 8-gigabit DDR4 DRAM, a benchmark price for the category, closed the week recording an average three-dollars-and-74-cents in Friday's trading.

It's up 14-point-six percent from last week's closing price and more than 23 percent higher than that of July fifth, a day after Japan's export curbs took effect.

@leonbeas

Most probably they will go up until January.

@Vitaliy_Kiselev

Thanks

Contract prices for mobile DRAM memory are set to register another sequential drop of 10-15% in the third quarter of 2019, and will continue trending downward in the fourth quarter, according to DRAMeXchange.

Cartel managed to stop desktop.server memory fall, expect some new fires to make prices back for mobile also.

DRAMeXchange said it expects DRAM prices to continue to fall in the third quarter of 2019. Consumer demand isn't expected to rise enough for suppliers to work through existing DRAM inventories, meaning suppliers are likely to see further price drops in the next quarter.

Seems opposite to that you can see on retail market, fall stopped and on many DDR4 sets price started to rise.

IC Insights has forecast that capital spending in the DRAM and flash memory segments will drop by 19% and 21%, respectively, in 2019. "The big cutbacks in spending in the DRAM and flash market segments this year are an attempt by the major memory suppliers to prevent further price erosion in the second half of 2019 and into 2020,"

Adata Technology chairman Simon Chen expressed previously optimism about the memory market next year. With 5G, AIoT and automotive electronics applications set to proliferate rapidly worldwide, memory chip demand will be robust in 2021-2022

Do not expect further price drops, as industry reached new cartel agreement.