- Conventional DRAM prices are set to rise 58–63% quarter over quarter.
- Current projections exclude potential impacts from the US, Israel, and Iran regional conflict.
- AI infrastructure is shifting production away from consumer memory markets rapidly.
The cost of memory and storage components is rising sharply, with new projections indicating significant increases across multiple segments.
New data from Trendforce shows conventional DRAM contract prices are expected to climb between 58% and 63% quarter over quarter, while NAND Flash prices could surge by as much as 70% to 75%.
A major factor behind these increases is the continued expansion of artificial intelligence infrastructure, which is drawing capacity away from consumer markets.
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AI demand reshapes supply priorities
Suppliers are reallocating production toward high-margin server applications, including enterprise SSDs and high-capacity memory modules used in AI systems.
This shift is tightening availability for consumer-grade components, forcing buyers to compete for reduced supply.
Demand for enterprise SSDs has shown little sign of slowing, as large-scale AI deployments continue to expand.
Cloud storage service providers are reportedly willing to accept higher prices and secure long-term agreements to guarantee access to critical components.
This dynamic strengthens supplier leverage, allowing them to maintain elevated pricing levels despite softer demand in traditional markets.
While suppliers are increasing output through process improvements and higher-density technologies, overall capacity growth remains constrained.
Meaningful expansion is not expected until late 2027 or 2028, leaving a prolonged period of tight supply conditions.
At the same time, manufacturers are deliberately limiting shipments to lower-margin segments, including client SSDs and NAND wafers, to preserve profitability.
In mobile and embedded storage markets, the situation appears similarly constrained.
Although smartphone demand has weakened, requirements for high-speed memory driven by AI features remain stable.
Automotive and industrial sectors have also contributed to demand recovery, further complicating supply allocation decisions.
As a result, some categories, particularly eMMC and UFS, are facing especially tight supply gaps with corresponding price increases.
The effects of constrained supply are visible across nearly all memory categories.
Graphics memory prices are rising due to limited capacity allocation, while consumer DRAM continues to face shortages as suppliers reduce their exposure to lower-margin products.
Even where demand has softened, reduced shipments have kept pricing elevated by limiting availability.
Buyers in the retail market are responding to these conditions by adjusting purchasing strategies, with some opting to rebuild inventories in anticipation of further increases.
However, rising costs are also suppressing demand in segments such as memory cards and USB storage, where margins are already thin.
Interestingly, the conflict between the US, Israel, and Iran, which is widely expected to disrupt supply chains and potentially push prices higher, was not factored into the current projections.
“Our analysts have not included the regional conflict in their current pricing models, as there has been no substantial disruption to memory supply observed at this stage,” TrendForce told TechRadar Pro.
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