By James Carbone -- Purchasing

Electronics buyers can expect DRAM prices to rise through the rest of the year because of production cutbacks, rising demand and migration to higher-density, higher-priced parts.

The average price of a DRAM was about $1.27 in the first quarter and then increased to $1.44 in the second quarter, says researcher IC Insights. The price will rise to $1.63 in the third quarter and then to $1.73 in the last quarter of 2009. For the entire year, the average DRAM price will be $1.54, according to the researcher.

While buyers won't like these price trends, the $1.54 2009 average price is still lower than last year's DRAM price of $1.83.

Brian Matas, vice president of research at IC Insights in Scottsdale, Ariz., says DRAM demand will rise in the second half because of higher seasonal demand for PCs, which consume the bulk of DRAM. Rising demand, coupled with production cutbacks by DRAM makers, mean supply should become tighter resulting in the upward price pressure.

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