Computer Demand Rising Globally, Pricing Coming Up Soon

DRAM (dynamic random access memory) chip sales hit $9.5 billion making more than the first half of 2009 and became the third largest  quarterly sum in 11 years, according to iSuppli. Prices went up  2.9% during the same period , which normally shows  a 15% drop during this, the slowest  time of the year for DRAM sales.

What could  create such a raise  during this  normally  slow  season? Hasn’t their been a big track toward buying discount computer hardware?

Mike Howard, iSupply analyst  said that sales and prices of DRAM chips “surged in the first quarter due to stronger-than anticipated demand for PCs and tight supplies. The strong performance bodes well for continued growth in 2010, possibly paving the way for the industry’s greatest year in history.”

The industry’s greatest year in history? Is this just  rosy optimism or a wave that can wield a full bull trend  ? Can other trends such as discount computer equipment change this outlook ?

DRAM chip’s norm selling prices are currently holding their velocity in the current quarter and supplier growth  concerns for DRAM parts are quickly becoming  an problem  as well.

It also appears  that  demand in the second half of the year will top the first half with the expansion  of supplies not keeping up with the increasing demand . Mike Howard states, “The first quarter of 2010 has positioned the industry for a bull run, the likes of which haven’t been seen in more than a decade.”

Raymond James, analyst iSuppli , predicts that DRAM sales could jump by 50% or even as much as 60% or more in the next  months  .

Other trends such as buying discount computer parts online is also adding novel  and sustained demand to the global  market.

For the last  three years DRAM memory prices have created  a monumental slump with new supplies  surpassing the accession in demand. But with the Worldwide  Recession in full swing, multiple companies have had to shut down  old factories and to run others below capacity. The worst injured party was with Qimonda AG which declared bankruptcy.

Although net income are on the rise , manufacturers are currently not investing in any new facilities  or in increasing capabilties  at current factories  . This is in demarcation to the top  semiconductor chip manufacturers such as Taiwan Semiconductor Manufacturing which is spending $4.8 billion on new factories or GlobalFoundries investing  between $3-6 billion.

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