Stamford, Conn. — August contract prices for NAND memory devices moved lower across most densities, led by the 32-Gb part, with a 5 percent decline, reported market research firm Gartner Inc. Prices were hurt by 3-bits-per-cell and new 2Xnm NAND MLC technologies, along with varying levels of quality for 3-bits-per-cell products, according to analysts.
The 3-bits-per-cell “low-grade” flash has caused significant softness in pricing in the flash card and USB flash drive segments, while the higher-grade segment of MLC parts remains healthy, with only modest price declines for some densities, reported Gartner.
Gartner analysts believe that NAND prices may stabilize after Apple announces its new models on September 1. The market research firm estimates that Apple consumes nearly 30 percent of the overall NAND demand and is poised to grow steadily in 2011.
Similarly, August contract pricing for both DDR2 and DDR3 edged down, continuing the trend that started in June, said Gartner. These reductions have lowered the DRAM cost by 10 percent for DDR3-based machines, shaving $9 off the cost of 4-GB configurations, according to Gartner analysts.
However, analysts say contract pricing still needs to decrease during the next few months to ease the pressure on PC vendors. While some DRAM vendors expect a stable pricing outlook for the remainder of the year, Samsung Electronics, which holds 35 percent of the market, says that it expects the current average selling price (ASP) declines to continue for the remainder of 2010.
Gartner analysts say this would be good for the industry because it would allow content growth within the PC to resume, helping to absorb some of the extra supply that will be hitting the market in the next two quarters.
In the NOR flash market, pricing started to decline between 0 percent and negative 12.9 percent as demand softened and supplies increased, reported Gartner. The market researcher reiterates its estimate from earlier this year that prices will weaken during the third quarter, then start to decline because of limited applications of NOR flash and expected increases in supplies.
In the spot market, pricing for both DDR2 and DDR3 continues to edge down, while market activity remains weak, reported Gartner. Average spot pricing across all densities and technologies was down 0.7 percent compared with the previous week, settling at $2.40 on a 1-Gb equivalent basis. The 52-week high for pricing is $3.07, while the 52-week low is $1.82.
Current pricing is trading at 32.2 percent above the 52-week low and 21.8 percent below the 52-week high, according to Gartner.
Year-to-date pricing for DRAMs is down 8 percent, compared with 2009, when spot pricing was up almost 100 percent at this point, said Gartner. Analysts believe that pricing will continue to edge down for much of the remainder of the year, and pricing could be close to 20 percent lower than at the start of the year.
Meanwhile, NAND flash spot prices fell for the fourth consecutive week and continue to fuel concern about softness in the low-grade flash segment, which is being almost entirely consumed in the flash card and USB flash drive segments, said Gartner. Pricing is now $4.60 for the 32-Gb device.