TrendForce: DRAM Shortage Spreads to DDR2, Prices of Legacy Memory Expected to Rise in Q3

On June 23, high-tech industry research firm TrendForce reported in a study released on June 22 that the supply of mature process DRAM continues to tighten, forcing consumer-grade DRAM buyers to turn to older generation memory products to secure more supply quotas. This shift is driving up demand for traditional DRAM such as DDR2 and DDR3, continuing the price increase for related products. The firm expects that the contract price for DDR2 will rise by approximately 55% to 60% in the second quarter of 2026, with a further increase of 35% to 40% in the third quarter. This indicates that after a strong increase in the first quarter, the price pressure on DDR2 has not eased but has continued to intensify due to an expanding supply-demand gap. The core reason on the supply side comes from the reallocation of advanced process capacity. TrendForce points out that the three major DRAM manufacturers still prioritize their capacity for HBM and server DRAM to meet the demand brought about by AI infrastructure development. Consequently, the wafer allocation for DDR4 and other mature process products has been compressed, forcing consumer-grade DRAM customers to seek support from Taiwanese suppliers. With limited supply, Taiwanese DRAM manufacturers such as Nanya Technology and Winbond have enhanced bargaining power. TrendForce states that due to demand significantly exceeding the bit shipment volume that Taiwanese manufacturers can provide, suppliers are strategically reducing the production of low-margin products and reallocating capacity to higher-value products to improve profit structures. Changes are also occurring on the demand side. As consumer-grade DRAM shortages and contract price increases continue, some OEM and ODM manufacturers have begun to downgrade memory specifications to control overall machine costs. Some designs originally using DDR4 have been switched to DDR3, and some DDR3 products have further transitioned to DDR2. Customers are attempting to exchange for relatively stable supply through lower capacity configurations or older generation products. This has caused the pressure of DRAM shortages to cascade down through the technology generations. The supply tightness, initially concentrated in HBM, server DRAM, and DDR4, has begun to spread to traditional products like DDR3 and DDR2, highlighting the crowding-out effect of AI demand on the entire memory industry chain. TrendForce identifies Winbond and Nanya Technology as the main suppliers of DDR2. However, Winbond is gradually reducing DDR2 production and reallocating related capacity to higher-margin products such as DDR3, DDR4, and LPDDR4, which will further exacerbate the supply tightness of DDR2. In contrast, Nanya Technology plans to expand DDR2 production as much as possible within the existing wafer allocation from Powerchip Semiconductor Manufacturing Corporation, concentrating resources to enhance profitability in this product line and partially fill the supply gap left by Winbond's exit from DDR2. This round of price increases shows that the memory demand driven by AI is no longer affecting only high-end HBM and server DRAM. As advanced capacity is redirected, mature process and older memory products are also beginning to become pressure points in the supply-demand imbalance. For consumer electronics, industrial control, and some long-lifecycle devices still reliant on DDR2 and DDR3, cost pressures may continue to rise in the second half of the year.