What's Causing the Memory Price Hike?

Trazom28 asks: "Anyone else noticed how much memory prices have jumped in the last few months? For example, back in early summer, I purchased a 128 meg stick of PC100 for around $100 from Micro Trends. It's been on a steady increase the last few months, and today, it goes for $182. So.. anyone else heard of why, or is this artifical market inflation? "

Comments

Asia Pac Economic Turnaround

[Anonymous Coward]

Remember last year when the far east economies crashed? Korea etc. had big currency devaluations etc.? When this happened demand for many commodities like oil, RAM etc. took a nose dive. Far eastern countries ramped up everything they could export to get foreign exchange to rebuild their economies via a favorable trade balance. Since they needed to, they ran up RAM production to the max, and sold it for a song. Well folks, now the far east is making an economic comeback. Now they have local demand for RAM, the US ecomony is doing great, and Europe is starting to come back. The result is going to be that they can't make enough RAM to satisfy demand, so the price is going up. Other commodities are starting to increase in price, too.

We have had an unusal period of low inflation and low interest rates in part caused by low commodity prices and low cost of imported goods. The fact of the matter is that this siuation is not going to last, and one of the first places that you are seeing the change is in RAM prices.

Its not so much a shortage... but a normalization

[_ECC_]

Its my understanding that last summer thru this year, the companies that produce RAM created WAY too much, and had like 2 or 3 years of over stock. So some companies went out of business from the sudden deflation in RAM prices, due to over supply under demand (basic econ). Now quantities are reaching nominal levels, but with the decreased competition, and rising demand we are seeing ram prices climb back upto and over their expected price points.

Prices are ridiculous right now, but they should come back down like everything else does. I just hope it happens sooner then latter.

Crossing my fingers, and guarding my corsair 128mb sticks,
Ecc

Ram prices

[eponymous cohort]

Unlike most PC components, whose prices tend to go down, down, down, RAM has tended to fluctuate quite a bit. There may be various reasons for this, all based on supply and demand.

Around 1988, for instance, an embargo caused memory prices to triple in a short time. There have been a couple of times in the nineties where the price has spiked. The often-repeated story was that there was a memory plant fire or explosion. I don't know how true that was.