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DRAM prices have fallen over 20 per cent since last month's high in the aftermath of the Taiwan earthquake. Memory Corporation was this morning quoting £140 for 128MB modules (PC 100), down from prices nudging £200 in the last week of September. Pricing from the Far East was more around £160 to £170 – a drop of 10 per cent, it said. Dane-Elec was quoting around $300 (£180) for the equivalent, against last Friday's price of $330 (£200). The industry seemed split over where the market was heading. Some distributors and OEMs thought the earthquake was still hitting the industry with general shortages. Alan Stanley, Dane-Elec general manager, said: "Prices may well continue the downward spiral, but they will go back up. "There is simply not enough product in the market." Other OEMs agreed, commenting that vendors seemed to be struggling with supply issues on other components and pushing back DRAM deliveries. Others were concerned that major players in the market were deliberately driving prices down. Richard Gordon, a Dataquest analyst, thought the worst was over regarding yo-yoing prices. "All the froth of the last couple of weeks over the earthquake is over and people seem to have seen sense," he said. Gordon said contract prices had started to firm up – at about $170 for a 128MB module – and prices in Q4 were back to where they had been in Q1. "Barring acts of God like the Taiwanese earthquake, we will see some softening of DRAM pricing right through to December. "But a lot depends on how close the market is to supply and demand and what the vendors do. "In our view, the market will have switched to undersupply – as opposed to the present undercapacity – by next year's Q3." Gordon described the possible uptake in orders following the i820/Rambus debacle as "a red herring" in terms of DRAM shortages. "There will be shortages anyway," he warned. ®

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