TAIPEI –  PC DRAM pricing dropped precipitously in the first quarter as quarterly contracts gave way to monthly deals.

The current quarterly decline dropped nearly 30%, the sharpest decline in a single season since 2011, says DRAMeXchange. February saw the largest down-correction in prices during the period, the research group added.

Inventory levels have continued to climb since overall contract prices dropped in the fourth quarter of last year, and most DRAM suppliers are currently holding about six weeks' worth of inventory, says the research firm. An outlier is Intel's low-end CPU, for which the supply shortage is expected to last until the end of the third quarter.

The overall market is in freefall, DRAMeXchange said, meaning large reductions in prices aren't going to be effective in driving sales. The high inventory will continue to cause force prices lower this year if demand doesn't make a strong comeback.

Meanwhile, considerable new capacity will come online in the next 24 months. SK Hynix announced it will invest some $107 billion to build four new wafer fabs, and Micron commenced construction of an IC testing and packaging plant in Taiwan. At the same time, its subsidiary Micron Memory Taiwan in Houli, Taichung, is considering building a new 12" DRAM wafer fab, which could finish construction as early as the end of next year and contribute to production in 2021. Samsung, the world's largest DRAM supplier,  is building a second fab at Pyeongtaek.

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