High memory prices could slow China's AI push, analyst says

Rising memory prices pose a significant constraint on China's AI development trajectory. Technologically, supply chain bottlenecks at the wafer fabrication level cascade through to packaging and testing, prolonging delivery timelines and increasing costs for downstream AI systems. With data center expansion accelerating, this cost pressure undermines investment appetite in compute infrastructure. From a compliance standpoint, although Washington does not treat memory pricing as a policy lever, global supply chain shifts heighten risks of technology blockades and supply disruptions for Chinese firms. In market dynamics, international vendors may exploit the situation to raise prices, prompting domestic players to accelerate self-reliance initiatives. Supply constraints are expected to persist through 2026, with relief likely in 2027. This price surge signals a broader realignment of global semiconductor resources, underscoring the urgency for China to achieve autonomy in high-end memory technologies.