NAND flash contract prices slip 1-5% in 1H November, says DRAMeXchange

Jessie Shen, DIGITIMES, Taipei [Wednesday 21 November 2012]

Early November contract prices for MLC (multi-level cell) NAND flash memory fell by 1-5% to reflect a slowdown in inventory replenishment, according to DRAMeXchange. Meanwhile, prices for TLC (triple-level cell) NAND chips were dragged down by 4-5% during the period, due to sluggish demand for USB drives and memory cards, said the price tracker.

System vendors previously stepped up their pace of chip orders in preparation for sales during the Thanksgiving week followed by the year-end shopping season, DRAMeXchange indicated. Thanks to the pick-up in replenishment demand, NAND flash contract prices had started rising since late September, DRAMeXchange said.

Chip suppliers' output controls also led to the previous rally in NAND flash contract prices, DRAMeXchange observed.

As for TLC chips used in flash storage devices, prices have been mainly affected by weakness in end markets, DRAMeXchange said.

Looking forward, DRAMeXchange expects contract prices for mainstream MLC chips to fall at a gradual pace through December. The firm also expressed caution about inventory replenishment prior to the Lunar New Year, judging from the available outlook given by most system OEMs.

On the supply side, chipmakers are likely to put their capacity expansion plans on hold, as demand visibility for 2013 remains limited, according to DRAMeXchange. It is also unclear whether Toshiba and other suppliers, which have scaled back their output, will resume full production, said DRAMeXchange.

Toshiba previously announced an adjustment to production of NAND flash memory at its Yokkaichi Operation plant (Mie Prefecture, Japan), which has consequently cut its overall NAND-chip production by approximately 30%.