[News] Chinese Phone Makers Eye Salvaged Memory as Chip Prices Reportedly Rise by Up to RMB 500 per Unit

What happened

Rising memory prices and tightening supply are reportedly pushing some Chinese smartphone makers to turn to salvaged memory chips. According to TechNews, some brands are said to be sourcing memory chips recovered from discarded phones, potentially including used iPhones, through traders in Shenzhen's Huaqiangbei electronics market. Sources say memory procurement costs have surged, with some chips reportedly costing up to RMB 500 more per unit; the Shenzhen local government is also rumored to be offering smartphone brands subsidies of around RMB 300 per unit, leaving manufacturers to absorb roughly RMB 200. Unable to fully pass on the increases, some brands are reportedly cutting production and sales volumes to limit losses. TechNews notes the reported price increases, subsidies, and use of salvaged chips have yet to be confirmed by Chinese authorities or the companies involved, and such chips are largely limited to ultra-low-cost, unbranded smartphones and are unlikely to enter flagship supply chains. As background: TrendForce says AI server demand continues to squeeze DRAM supply, with shortages and price increases expected to persist into 2027; TrendForce projected global smartphone production would fall 14% year over year to approximately 1.07 billion units in 2026, a forecast revised upward due to earlier-than-expected purchases and restored production. Caijing's April investigation found a Shandong recycler purchased around 1,000 discarded phones in March and dismantled more than 600 for potential chip resale, with some nonfunctional devices reportedly fetching more than RMB 100 each; some recyclers preferred Android phones from OPPO, vivo, and Huawei, while sources told TechNews that Huaqiangbei traders primarily purchased used iPhones. A September STAR Market Daily investigation found refurbished chips can serve lower-end applications such as automotive accessories, IoT devices, and overseas refurbished phones, but analysts cautioned that salvaged chips face yield losses and compatibility risks, and recycling premiums could quickly disappear if major chipmakers adjust production.

Impact and signal

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Source and time

Source: TrendForce · 10/18/2026 · View original source