NAND contract prices stabilize
Production cutbacks have led to more steady prices--for now
By Jim Carbone -- Purchasing, 1/7/2009 5:28:00 PM
The freefall of NAND flash memory prices may be coming to an end. Contract prices in the second half of December were either flat or increased by as much as 20% in some deals between suppliers and OEMs and electronics manufacturing services providers, according to Taiwanese researcher DRAMeXchange.
Major NAND flash memory suppliers have reduced wafer production. The researcher says it expects first quarter 2009 production to be 10% less than production in the fourth quarter of 2008. In addition, NAND flash suppliers will adjust their product mix, producing fewer less profitable NAND chips and more leading-edge parts that have higher margins. While NAND flash memory demand remains weak, the production cutbacks have encouraged some buyers to restock some NAND products, which has led to some price stability and even increases with some contracts.
Whether prices remain stable or increase remains to be seen. By most accounts, the global economic recession is expected to get worse before it gets better. That will mean less demand for electronics equipment, including consumer devices that use NAND. Depending on how much equipment demand declines, NAND prices could fall again.
Also see: NAND market falls on lower prices
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