The NAND Flash market is set to enter a phase of scarcity and price increases, as forecasted by Pua Khein-Seng, CEO of Phison, a renowned NAND Flash control chip manufacturer. This prediction stems from a combination of reduced production by key memory chip manufacturers and a rebound in the end market.
Pua Khein-Seng, in a recent interview, highlighted that while Phison’s shipments have seen an upswing, the overall market supply is tightening. This situation is primarily due to production cuts by leading manufacturers, signalling a probable shortage of NAND Flash in the coming year. While Phison, not being a memory chip factory itself, refrains from commenting on the strategies of memory chip producers, Khein-Seng observed that the current market prices for NAND Flash are at a low point. However, he anticipates a strong momentum in demand, potentially leading to significant growth.
A critical factor influencing this market shift is Samsung’s strategy. Starting from September, Samsung has implemented a substantial production reduction in NAND Flash memory, halving its total production capacity. This move aims to accelerate the process of destocking and to stabilise NAND Flash prices. Looking forward, Samsung plans to incrementally hike the price of NAND Flash from mid-2024, with a strategy to increase prices by 20% every quarter. This could result in a cumulative price rise of 60% over approximately two and a half quarters.
This anticipated change in the NAND Flash market is significant for the electronics industry. The expected shortage and price escalation underline the need for companies in the sector to prepare for tighter supply conditions and higher costs. As NAND Flash is a critical component in many electronic devices, these market dynamics are likely to have wide-ranging implications across the industry.
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