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DRAM makers to keep low utilization rates in 2009

Posted: 02 Apr 2009 ?? ?Print Version ?Bookmark and Share

Keywords:DRAM utilization? memory market? supply growth DRAM?

A new report from DRAMeXchange stated that DRAM makers will be forced to maintain low utilization rates of under 50 percent by end of 2009, resulting in 2.43 percent bit growth, compared to 95 percent in 2007 and 66 percent in 2008.

The market research firm lowered its 2009 DRAM supply bit growth estimate from 17.82 percent to 2.43 percent stating probable low utilization rates and more production cuts due to tight cash levels and low prices.

DRAMeXchange also cuts its demand bit growth from 19.82 percent to 13.84 percent due to lower PC shipment growth and content per box growth. The 2.43 percent supply bit growth should bring the supply below the demand in 2H 09 and help the DRAM DDR2 prices move up to the range of $1.2 to $1.5 if the inventory reduction goes well.

Shortage ahead
According to DRAMeXchange's survey, February DRAM output dropped to 687 million, 21 percent down from the highest level at 867 million in September 2008. DRAM output should continue to go down further, as some DRAM makers are expected to cut capacity in Q1 09. This indicates that the DRAM market has reached near a balance and should experience a shortage in 2H 09. However, it also noted that most PC OEMs, module houses and channel distributors have built up over one month inventory, which could hamper the upward momentum in the possible shortage in 2H09.

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