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TrendForce:2Q13 NAND Flash Market to Remain Sluggish due to Seasonality Effects

3 April 2013 Semiconductors

According to DRAMeXchange, a research division of TrendForce, NAND Flash manufacturers are continuing to allocate capacity to the 64Gb and 128Gb products as a means to satisfy the OEM clients making eMMCs and SSDs. The output of the 32Gb products made with the older process technology, in contrast, has been observed to be on a continuous decline. On the whole, chip contract prices for 64Gb and 128Gb MLC and TLC remained flat, whereas those for the 32Gb MLC and TLC products increased by approximately 6-7%.

The 64Gb and 128Gb MLC products will continue to be intended for the OEM clients making SSDs and eMMCs. Our research has shown that the majority of the new smartphones, tablet PCs, and ultrabooks will be released in June, and that most of the product shipments will be concentrated around the third quarter. Because of this, the slow season effects are expected to be more noticeable throughout 2Q12, and the NAND Flash chip contract prices, for the most part, is expected to weaken. Most of the NAND Flash chips made using the 20nm-class process products are known to have a density of at least 64Gb. Compared to their high-density counterparts, the 16Gb and 32Gb chips made using the 25nm-class process have a significantly lower production ratio and are gradually expected to be phase out in the near future. Even in the absence of obvious demand for the low density 16Gb and 32Gb chips, we believe that their prices will hold up relatively well due to their rapidly declining supply.

Given the inevitable effects of the typical off-peak quarter, along with the NAND Flash manufacturers' focus on satisfying the demands of the SSD and eMMC OEM clients, the prices for 64Gb and 128Gb chips are expected to continue weakening. As the supply of the low density NAND Flash chips intended for the memory card and UFD channel markets continues to drop, their chip prices are expected to be more stable than those of their high density counterparts.

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