Graphics Card Shortage Could Ease As Street Prices Finally Start To Drop
Finding a graphics card in stock from a first-party retailer could soon be a little bit easier than it has been in a very long time. That's not to say the shortage is about to end. However, those within the supply chain apparently feel confident that an uptick in ABF (Ajinomoto Build-up Film) substrate shipments will contribute to more graphics card entering the market as soon as next month.
ABF provides electrical insulation of advanced circuit substrates found in GPUs and CPUs. The material was discovered around 50 years ago and was adopted by Intel in the 1990s because of how well it works. It has since been a staple of advanced semiconductors by the likes of all the major players.
Incidentally, Intel warned investors last July that "industry-wide component and substrate shortages" could dampen its revenues. The shortage of substrate has in turn exacerbated the shortage of certain consumer products, like graphics cards.
There's good news, though. Multiple reports indicate that ABF suppliers like Unimicron and NanYa have ramped up production. As such, industry sources told Digitimes that these ramps in substrate production will lead to "smooth shipments of new graphics cards starting after February." Leading credence to the claim, both ASRock and TUL expect an uptick in revenues and profits because of increased graphics card sales.
It really amounts to a glimmer of hope. After all, the GPU shortage is not due solely to substrates. There are multiple other factors, including increased demand during an ongoing pandemic and new product launches, a thriving scalper economy, and cryptocurrency mining.
Correlation Between Cryptocurrency Values And GPU Prices
Let's talk about cryptocurrency for a moment. Mining has been the bane of gamers in search of a GPU, because cryptos like Ethereum, Litecoin, Ravencoin and others are effectively mined with graphics cards. Bitcoin is primarily mined on ASIC hardware (a category even Intel is embracing), but it still has an impact since miners can swap other coins for Bitcoin.
Cryptocurrencies have been on a downward swing lately. Bitcoin, for example, recently dropped below $35,000 after topping $67,000 last November. Likewise, Ethereum has fallen nearly in half during the same time span.
Source: 3DCenter
The folks at 3DCenter have kept a pulse on street pricing for GPUs in Europe, and plotting the data on a graph shows a correlation with cryptocurrency values. Don't mistake that for causation, but if crypto values are having some kind of impact on GPU prices, then the recent downturn should result in cheaper street prices.
Indeed, graphics cards are selling for a little less now than they were last month. That's the good news. The bad news is they're still way over MSRP. According to the plotted data, AMD's Radeon RX 6000 series is commanding 67% above MSRP, while NVIDIA's GeForce RTX 30 series sells on average for 77% above MSRP.
Still, that's way better than when street pricing peaked last May, when GPUs fetched double and even triple their MSRPs. We can only wait and see if this trend continues (especially if and when the crypto market rebounds), but combined with increased supplies on the horizon, there is at least reason to be somewhat optimistic.
