TrendForce：1HSep. NAND Flash Contract Prices Remain Stable amidst Slow Market Transactions

According to DRAMeXchange, a research division of TrendForce, given the market concerns regarding a peak-less season, transaction volumes within the NAND Flash market have been rather light. However, with the replenishment demand for new smartphones, tablet PCs, and other hardware products, the 1HSep. NAND Flash average contract prices exhibit a partially flat, partially rising trend. It is predicted that these prices will continue to remain stable in the near future, and that the overall year end peak season performance will largely determine the 4Q12 NAND Flash pricing trend.

On the supply side, as new product replenishment demand is likely to relieve NAND Flash suppliers of pressures related to capacity consumption, supply control strategies are expected to continue, which may in turn help maintain stable NAND Flash prices. With regards to demand, NAND Flash buyers’ conservative attitude towards the upcoming traditional peak season has led to more cautious inventory management policies, which are aimed at minimizing potential risks associated with inventory price drops.

Regarding the UFD market, even though 3Q12 is usually the traditional peak season, NAND Flash vendors’ supply control strategies have been making it more difficult for downstream manufacturers to receive a stable and standard amount of resources. As a result, this has created an impact on both the manufacturers’ shipments and product mix. On a further note, following the Ivy Bridge release delay and the postponed PC momentum induced by Windows 8, demand for the USB 3.0, originally anticipated to stimulate the 2H12 UFD market, ended up being weaker than expected. By factoring in global economical woes and rising interest in cloud storage, TrendForce predicts that there will only be a slight growth in the UFD market compared to the last quarter, which will in turn lead to a peak season that is not as strong as it has historically been.