Jefferies Forecasts DRAM Prices to Surge 40% in Q3

Storage costs for computers and smartphones are set to climb sharply over the next two years, a shift that will likely increase the price of consumer electronics. Jefferies forecasts that storage prices will rise 40 to 50 percent in the third quarter alone. This rapid increase matters because it reduces the amount of memory and storage available for standard devices. Buyers should expect higher prices for new gadgets in the coming months as manufacturers pass on these component costs.

Cloud contracts shrink supply for consumer electronics

The forecast covers the global market for DRAM and NAND flash memory, which power everything from data centers to personal laptops. Jefferies projects that storage prices will continue to climb in the fourth quarter, with another 30 to 40 percent increase expected. The upward trend is not temporary. Analysts expect full-year storage prices to rise 40 to 45 percent in 2027 compared to the previous year.

A major driver of these price hikes is the shrinking supply of memory chips available for general sale. Approximately half of all global storage capacity is currently locked into long-term agreements between memory manufacturers and cloud providers. Jefferies predicts this ratio will grow to 70 percent, further restricting the supply for consumer electronics. This shift prioritizes enterprise cloud storage over the devices that individual users buy.

Chinese memory makers CXMT and YMTC are not expected to alleviate these global supply constraints in the near future. The forecast states that these domestic manufacturers lack the export capacity and pricing competitiveness to impact global markets until 2028. Their current output remains limited, and their prices are already in line with international peers. This means global consumers cannot rely on new Chinese capacity to stabilize prices in the immediate term.

The data confirms that storage prices will not peak until 2028, according to the Jefferies analysis. The combination of locked-in cloud contracts and limited new supply creates a sustained pressure on costs. Consumers and manufacturers alike must plan for a multi-year period of rising storage expenses. The market will remain tight until new capacity comes online in the latter half of the decade.