ChangXin Memory Technologies (CXMT), the Hefei-based company founded in 2016 that has grown into China’s largest DRAM maker, was reported by Omdia to have reached a peak of about 240,000 wafers per month at the end of the previous year, but the global memory shortage that helped drive its expansion continues to push prices higher.

A hard ceiling, not a temporary pause

Those expecting larger Chinese supply to ease market conditions may need to think again, as the available figures point in the opposite direction. CXMT has raised wafer output to twice the level of 2024, but that expansion has slowed sharply. According to industry insiders quoted by ChosunBiz, production is expected to remain at the same level throughout the year.

Two main factors have limited further progress: Washington’s restrictions on exports of advanced chipmaking equipment — first imposed in October 2022 and tightened since, with Japan and the Netherlands adding their own limits on advanced chipmaking tools in 2023 — and CXMT’s yields, which still trail industry leaders. According to Counterpoint Research, CXMT’s first-generation 10-nanometer DRAM technology still has yields 42% lower than Samsung and SK Hynix, leaving CXMT’s yield at close to 50%.

The trader whose remarks sparked this week’s discussion stated the issue plainly. On August 24, @MelvinInvestes posted on X that China had “just proved it can’t out build the memory shortage ,” a view that he said does not bode well for anyone except Micron, Samsung, and SK Hynix — the trio that has long supplied the overwhelming majority of the world’s DRAM.

The capacity data support that concern. Even at full utilization, CXMT’s rated output is estimated at roughly 50% of SK Hynix’s and around 30% of Samsung’s, according to ChosunBiz.

Contract prices continue to climb

With Chinese supply constrained, prices keep rising. TrendForce expects conventional DRAM contract prices to rise another 13% to 18% quarter-on-quarter in the third quarter of 2026, citing strong demand for AI servers and production curbs at the largest industry players, which have also been steering more wafer capacity into high-bandwidth memory for AI accelerators — chips that consume substantially more silicon per bit than conventional DRAM.

The longer-term price trend is even steeper. J.P. Morgan Global Research said DRAM prices could rise by more than 400% between the beginning of 2024 and the end of 2026, linking the increase to hyperscalers securing supply through long-term contracts.

The pressure is no longer confined to data centers. Omdia said more than 50% of total semiconductor revenue is expected to come from memory chips in 2026, which means smartphones, PCs, and other consumer electronics may face higher component costs as manufacturers prioritize higher-margin AI products.

Stronger at home, but still constrained

CXMT is not a weak player. The company has moved from years of government-backed losses to becoming an important pricing force, Reuters reported. It posted $7.5 billion in first-quarter revenue and completed an $8.6 billion Shanghai listing.

It has also signed a five-year memory supply agreement worth more than $7 billion with ByteDance and, in some cases, charged Chinese buyers more than Samsung and SK Hynix. Counterpoint estimates that CXMT now accounts for around 9% of global DRAM bit shipments.

Still, scale is not the same as sufficient capacity. Beijing has asked CXMT to prioritize domestic customers, and its existing production is already stretched by demand at home. Goldman Sachs said CXMT is expected to meet only 41% of China’s DRAM demand in 2026, rising to just 50% by 2028.

That leaves China dependent on the same foreign memory suppliers it has sought to replace.

Rivals continue pouring money into new fabs

The industry’s biggest players are spending heavily to defend their positions, but meaningful new supply remains years away.

SK Hynix approved 54 trillion won, or about $38 billion, in early August to build two new fabs, as Cryptopolitan reported. Its Y2 DRAM plant is not expected to reach the cleanroom stage until mid-2029.

Samsung’s memory division recently reported its highest-ever quarterly revenue, while also saying supply constraints will remain in place until the second half of 2026.

Micron, the third incumbent, has announced roughly $200 billion in planned US investment, including new fabs.

Counterpoint said CXMT also plans to expand output capacity to as much as 420,000 wafers per month by 2027, when new production facilities in Shanghai and Beijing are expected to come online. How much of that becomes usable supply will depend in part on whether CXMT can narrow the yield gap Counterpoint identified. Until then, the DRAM market is likely to remain shaped by limited availability.

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