It is hard to get your hands on a new graphics card at the moment. Whether you are looking for a next-gen card or an older one, all of the cards that come into stock lately have inflated prices and limited availability.
In a nutshell, the current demand for graphics cards greatly outweighs the supply. How did this happen? Why can’t the supply keep up with demand?
In this article, we look at the reasons why graphics cards are so expensive right now. Some of which you’ll probably already be aware of, but others which may be news to you.
The Global Chip Shortage
We are currently in the midst of a global chip shortage that could continue into the unforeseeable future. Semi-conductor chips are used in everything from computers to airplanes, so manufacturers from all around the world have had scale back or limit their production due to the shortage.
This impacts not only graphics cards, but other electronics as well, including laptops, phones, and video game consoles.
The COVID-19 Pandemic
Due to COVID-19, an increased number of people are working remotely or staying home as much as possible. This has resulted in an increased demand for personal electronics.
Whether it is for work or for entertainment, lots of people are looking to buy electronic devices like computers, smartphones, or tablets. This has drastically increased the demand for graphics cards.
Another effect of COVID-19 is broken supply chains. Several towns and cities have implemented lockdown procedures which limit the amount of imports and exports that come through their area. This has resulted in suppliers canceling some of their ordinary shipping routes to avoid supplying towns or cities that are no longer buying their goods.
Graphics cards are likely to be considered a luxury good compared to other more essential goods like food or water. Therefore, local governments looking to limit their imports will probably start by limiting shipments of graphics cards or other similar items before anything else.
When your town or city no longer has graphics cards shipped in to your local stores, you are forced to look elsewhere if you wish to purchase one.
This results in people looking to outside markets for the goods they desire. People turn to online retailers or retailers from another major city when they can no longer buy locally. This further crowds markets which other people are turning to as well.
US Tariffs on Imports
During the Trump Administration, new tariffs were administered on imports from overseas, including a tariff that imposed a 25 percent tax on graphics cards imported from China. This extra cost is passed along to US consumers through increased prices.
The Biden Administration has not declared any plans to reverse Trump’s tariffs on China yet. They have only stated that they intend to re-evaluate their current trade agreements before moving forward with any new strategies.
Cryptocurrency Miners
Crypto miners love a good graphics card. They buy cards for their crypto mining rigs, which are computer systems used for mining bitcoins. Crypto miners often have high requirements for what kind of graphics cards they use in their rigs; the faster the card, the faster they can mine, so higher-end cards are more desirable.
Crypto miners have entered the high-end graphics card market and show no intention of leaving anytime soon.
One interesting requirement for crypto mining is at least 4GB of video RAM. Video RAM (or VRAM) is the amount of random access memory included on your graphics card. Crypto miners need to use cards with at least 4GB of video RAM in order to mine effectively, with many preferring 6-8GB for longevity and performance reasons. One effect this has had on the market is now cards with more than 4GB of video RAM have become even rarer.
NVIDIA recently announced that it would restrict crypto mining on its new cards.
Scalpers Selling Hardware on for Profit
Crypto miners aren’t the only ones crowding the graphics card market; scalpers have entered the market looking for monetary gain as well, although they employ different tactics to meet their ends. Scalpers resell goods for a quick (and usually large) profit. Graphics cards are currently desirable products for scalpers because they can be resold at a high prices to desperate consumers.
Scalpers aggressively buy up whatever graphics cards come into stock and resell them to desperate or ignorant customers at dramatically inflated prices. Sometimes scalpers obtain their stock through questionable means, however in many parts of the world scalping is still a legal practice. In the US, there are no federal laws prohibiting scalping, although a few states have implemented laws which discourage the practice.
Improved Cards Lead to Higher Prices
Next-gen cards use improved materials and remastered designs. Generally speaking, they are harder to manufacture than the ones from the previous generation. This results in higher manufacturing costs.
Manufacturers can only manufacture what they can afford, so when faced with increased manufacturing costs, manufacturers must get creative about how to maximize their output without compromising the quality or the quantity of their product.
Next-gen cards from NVIDIA and AMD are pushing the boundaries of computer graphics in a big way. These cards are making a big leap in GPU history because they are designed to output high-quality graphics at historically large resolutions like 4K. The jump from 1080p resolution to 4K resolution is quite a big one, so the next generation of graphics cards are ramping up in a big way.
Graphics Cards: To Buy or Not to Buy?
It is hard to find a reasonably priced graphics card right now if you are in the market for one. The crypto miners have snatched up most of the high-end cards with 4GB or more of video RAM, and the scalpers continue to snag any high-end cards that come into stock. Along with the global chip shortage and the pandemic, there just aren’t enough of these things to go around.
If you are OK with settling for an older graphics card with 4GB or less of VRAM, then you will have some options to choose from. But otherwise, you may have to get creative or simply wait this shortage out.
About The Author
.jpg?fit=crop&w=100&h=100)