DRAM Demand Returns; Q3 Global Sales Up 4%
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Server DRAM prices continue to rise as supply remains tight in the first quarter of 2018, according to DRAMeXchange, a division of TrendForce. Server DRAMs have been in tight supply since the third quarter of 2017, driven by new internet data center projects in North America.
DRAMeXchange estimates the prices of DDR4 32 GB RDIMM at $300 with the exception of long-term agreements. DRAM module prices will average around $310 for second-tier server ODMs, which is about three to five percent higher compared to the fourth quarter of 2017.
The strongest drivers for DRAM bit growth in 2018 will continue to be the expansion in the server space, said Ernie Maddock, CFO, at Micron Technology during the JPMorgan CES Tech Forum Conference in January. Maddock also noted that “mobile is certainly on track to have another good year of growth,” which will be complemented by growth in autonomous driving.
Maddock also expects edge computing to drive growth as devices such as refrigerators or security cameras have expanded functionality in the future. This will drive many endpoints that require more and more memory, and in turn will require more memory compute capability in the datacenter, he said.
“I think one of the most often overlooked thoughts as we look at this market is how interconnected everything is,” Maddock continued. “It's not as if something that happens in the mobile market ultimately doesn't affect the server market, because most of your content on your mobile phone is delivered to you from a server somewhere. So the more content you are demanding on your mobile phone, the more that's placing demands on servers.”
Conservative production capacity plans are contributing to continued tight supply in the first half of 2018, according to TrendForce. Analysts don’t expect new production capacity to be available until the second half of 2018, resulting in continued tight supply and higher prices at least in the first half of this year.
However, server DRAM production continues to migrate to advanced processes. Samsung will expand the wafer capacity of its 18-nm process in the first quarter of 2018, which will account for more than 50 percent of the company’s total capacity, said DRAMeXchange, allowing Samsung to take the lead among competitors.
SK Hynix and Micron are expected to focus on 17-nm and 18-nm processes, increasing the portion of high-density server modules in their production. Both companies will focus on raising yield rates and more efficient production, said DRAMeXchange.
DRAMeXchange forecasts the production of 17/18nm process to increase in the second quarter of 2018, and likely account for 40 percent of DRAM production by the end of this year.
At the same time, high-bandwidth server modules are expected to become mainstream products as production for higher clock rate products (2666 MHz and 2400 MHz) overtake 2133-MHz devices.
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