Mining downturn hits RAM-makers’ bottom lines

A slow-down in demand for hardware from crypto-miners means that prices for DRAM (Dynamic Random Access Memory) are likely to drop this year, according to reports. 

The recent drop in the price of cryptocurrency is causing ripples across the processor industry, and now reports say that it is “rocking the market for DRAM chips in Japan and elsewhere” – another semiconductor-reliant part of the computing equation.

The market, which centres around demand from smartphones, data centres, and – as of late – crypto has seen a big drop-off from the latter in recent months. The Nikkei Asian Review  quotes a Tokyo electronics parts trader as saying “Orders for DRAMs fell noticeably in April, we previously received quite a lot of orders, even from companies with whom we did little business.”

Graphics card maker NVidia and processor giant AMD have both registered a significant downturn in interest from miners over recent weeks – an activity that relies on fast number-crunching computers, and was especially suited to their graphics cards.

Now, Tokyo’s Akihabara electronics district apparently has shelves filled with graphics cards that were, until recently, highly coveted by gamers and miners alike.

“Until February, we would receive 10 calls a day asking if we had such and such video cards in stock,” one shop worker told the newspaper, “These days, we’re doing well if we get one such call a week.”

It would appear that, due to production lag, just as companies had managed to ramp up production to meet stratospheric demand in late 2017, the new year bought a massive drop in crypto prices. This, in turn, has now led to a glut of supply.

While it was the hope of many RAM-makers that cryptocurrency mining would represent a new area of demand that would make up for decline in smartphone demand. That now appears to be unlikely, at least in the short-term. Though it is expected that prices will pick up later in 2018, as supply again drops back to better match demand.