Statistics from memory market research outfit DRAMeXchange have revealed a sharp reversal of the downward trend in DDR2 memory prices from a late August spot price of around $1.80 for DDR2 667Mhz 1Gb.
By the middle of this month it had dropped to as low as 58 cents and DRAMeXchange says the material cost of producing this memory is 60 cents so this was clearly not sustainable.
The main reason for the plummet in price has been over-production. Therefore, in order to reverse this decline, DRAM producers have cut output dramatically.
This attempt to correct the supply/demand equilibrium appears to be working, as the spot price of DDR2 667Mhz 1Gb has shot up by over 27 percent in the past week.
DRAMeXchange now reckons we'll see spot prices back above a dollar before long and expects the effect of this cut in output to continue for most of Q1 2009. It also expects a similar phenomenon to occur in the NAND Flash markets.