Soaring prices, but shrinking demand as China’s memory chip market falters

China’s secondary semiconductor market is seeing a sharp run-up in memory chip prices as global supplies tighten, though vendors say the rally faces an awkward conundrum: the price tags might be higher, but the buyers are disappearing.

“We’re looking at high asking prices, but no buyers,” said Cai Zhaojie, a merchant who sells electronic components at Huaqiangbei, the vast Shenzhen wholesale hub often described as the world’s biggest electronics market.

The mark-ups on memory products had become “totally outrageous”, Cai told the Post on Wednesday, adding that the rapid inflation was pushing customers away rather than drawing them in.

Merchants at Huaqiangbei had reported steep increases in memory chips since late last year, with DDR5 – the latest generation of dynamic random-access memory (DRAM) used in PCs, smartphones and servers – among the most in demand items.

A single 256-gigabyte DDR5 server memory stick from Samsung Electronics or SK Hynix had climbed above 40,000 yuan (US$5,700) in China’s spot market, with some units priced as high as 49,999 yuan, according to a report by the Chinese outlet Jiemian.

A DDR4 Random Access Memory, or RAM module: bigger prices but fewer buyers. Photo: Shutterstock

At those levels, a standard shipping box of 100 sticks would cost about 5 million yuan, the report said, prompting industry insiders to remark that the shipment now “exceeds the value of many real estate properties in Shanghai”.

_{Soaring prices, but shrinking demand as China’s memory chip market falters}

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