GPU prices will continue to rise in the coming quarters and the culprit is DRAM

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The ongoing shortage of graphics cards has affected the market on an extremely larger scale and there are many reasons why the market isn’t picking up even after a year. one of the main reasons for the suffering of the graphics card market is the graphics DRAM prices.

Accordingly, the prices are up 200% over the average in the contract market and up 100% over the average in the spot market, graphics DRAM has become extremely expensive. However, the bad news is that TrendForce has predicted that the prices will yet again continue to rise.

According to sources, the fulfillment rates for small to medium size clients sit around 30% in the contract market. and the situation is expected to continue into the third quarter of this year. the price of the limited supply is expected to increase 8-13% QoQ along with the shortage of supply.

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However, another factor that has contributed to the increasing prices is the rise of the cryptocurrency boom this year. but in the GDDR5 market, there is little to no difference between the prices in the spot market and the contract prices. but the price of GDDR6, in the spot market has increased to 100% higher than the contract prices.

TrendForce believes that the high demand in the PC market with gaming-oriented graphics cards will be the main driver for the more increase in prices. it also states that the prioritization of larger customers with greater demands like NVIDIA will also be an additional factor. But it also believes that the consumer market will also suffer from supply constraints because of the increase in demand for server DRAM. And the DRAM suppliers prioritize the server market.

Analysts believe that prices of DRAM in the contract market are expected to rise 8-13% in the third quarter and small to medium size OEMs/ODMs will take the biggest hit. Graphics card prices will continue to remain high.

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