Market research firm TrendForce shared some seemingly good news for gamers looking for graphics cards. Analysts point out that a “sudden drop in cryptocurrency prices” has hurt the graphics DRAM market. And by extension, that means graphics card prices are also falling.
So why am I not excited about this?
For a variety of reasons, they all sum up the same thing: Actually, buying a graphics card anywhere near MSRP is still the hardest part in gaming, and I don't see that changing any time soon. Sorry that man, but any optimism about the GPU market right now feels out of place.
Let's see The actual TrendForce report. In it, the market research firm claims that "the active interventions of many governments" have led to a sharp drop in cryptocurrency prices over the past two months. In particular, the recent and "sudden drop in Ethereum prices caused the GDDR5 and GDDR6 spot prices to fall." These are the memory chips that are predominantly found in most modern graphics cards.
Some models feature GDDR6X and various high-bandwidth (HBM) memory solutions, and while the report doesn’t specifically expose them, I imagine they also went down in price.
TrendForce claims that one-time graphics DRAM prices tend to rise and fall from Ethereum because, up to this point, they are largely exploited with graphics cards. Over a two-month period, the market research firm says Ethereum’s prices fell by more than 50% as a result of the increase in regulatory measures. This, according to the firm, also reduced the price of graphics cards.
"As a result, the interest of miners and cryptocurrency investors in ETH has also declined significantly. Strong demand from cryptocurrency miners also means that a substantial number of graphics cards are being introduced to the second-hand market. TrendForce research shows that spot prices for graphics cards have fallen by around 20-60% over the last month or so, ”says TrendForce.
It seems like great news until you really try to buy a graphics card. A quick look at Newegg shows that the least expensive part of the GeForce RTX 30 series is a GeForce RTX 3060 model that sells for $ 730 — plus another $ 40 shipping — for a market vendor.
So that’s $ 770 for a card that should be priced at $ 329 somewhere in the neighborhood. A couple of other RTX 3060 listings are priced at about $ 1,000.
In normal times, a sudden drop in GPU memory prices could have a positive effect on consumers who want to earn their dollars. But these are not normal times. Several industry giants such as Intel and TSMC have warned that global silicon shortages could last for the next year. Nor are they old predictions; just this week, Jean-Marc Chery, CEO of STMicro, has said things will not return to normal "until the first half of 2023." Bummer.
But there are also some warnings about TrendForce’s own report.
“It should be noted that, given the highly volatile nature of the graphics DRAM market, it is relatively normal for graphics DRAM prices to reverse course or experience more drastic fluctuation compared to other major DRAM products,” says TrendForce.
In addition, the firm says prices for long-term DRAM contracts are expected to rise by almost 15% this quarter. Therefore, it is not as if GPU prices are falling.
However, TrendForce remains optimistic and states that "as the supply of second-hand graphics cards increases, some graphics card manufacturers may initiate promotional price reductions to increase sales."
And, you know, there may be someday winged creatures with pig features as well.
It’s worth remembering that Ethereum is switching to a different algorithm that should effectively kill GPU demand, as it belongs in mining (as long as Ethereum miners don’t jump to something like Ravencoin). Therefore, if you are willing to try a used card that has struggled and may no longer have maximum performance, there may be at least more reasonable prices on eBay in the near future. Otherwise, it could still take a long time until GPUs can be re-acquired in MSRP territory.