Bad news once again. The year 2024 is going to be tough in terms of memory, and unfortunately, almost everything uses it, whether it’s one type or another. Systems, devices, and various products are becoming increasingly dependent on a type of memory that is on the rise: NAND Flash. According to the latest report, NAND Flash prices are expected to soar in the first quarter of 2024, with an increase of between 15% and 20%.
Manufacturers have been losing money, as we have seen during the last year, and now they are reversing the situation, taking advantage of the demand. The equation is simple: if there is no demand, lower the prices, in this case, to cost. But if there is demand and you have lost a lot of money before… disaster for both consumers and manufacturers.
NAND Flash prices will experience a sudden increase in the first quarter of 2024
The ongoing research on how NAND Flash manufacturers and businesses are handling contracts at the beginning of the year is expected to result in enormous damages. Forecasts are not good, and as the saying goes, whatever goes up must come down… to go back up again.
The report presents a compelling argument which states:
A key point to keep in mind is the aggressive price increase initiated by NAND Flash manufacturers to compensate for their losses. However, since demand struggles to keep pace with these rapid increases, future price hikes depend on the resurgence of enterprise SSD procurement.
In the first quarter of 2024, various production strategies will be observed among the suppliers, and some will increase production prematurely. This may create additional pressure if the predicted growth in demand falls short, which could potentially moderate price increases in the second half of 2024.
Which sector will have the highest increase of all?
The chart is definitive, and the reasons are various, so we will summarize them. First, consumer SSDs, which are of the most interest to us. It is reported that manufacturers will purchase much more NAND Flash in this first quarter of 2024 despite the price increase, hoping to do so now before another rise comes.
Therefore, they will transfer this cost increase to their products, meaning, the SSDs that we will be buying this year. How much of an increase is projected? Between 15% and 20%. In the case of enterprise SSDs, the increase is even greater, from +18% to +23%, and all because manufacturers expect businesses to go on a buying spree before everything jumps up again.
But the news does not improve, and here we must talk about NAND Flash storage in UFS, a standard present in many high-performance smartphones. The problem here is that the supply is at its lowest, something done on purpose to increase prices.
Since there is not enough memory for everyone, manufacturers have started placing orders to secure inventory, thinking that with another increase in the next quarter, and an even worse supply, they may run out of memory for their phones. The price increase here will be between +18% up to +23%.
Wafers are also affected this time
Lastly, NAND Flash wafers. The report discusses an uncertain recovery in demand. There is a push and pull that does not allow a large-scale increase, because there is plenty of inventory, and manufacturers cannot play with supply shortages, at least for now. Therefore, the report predicts a wafer price increase for the first quarter of 2024 between 8% and 13%.
The worst part is that this won’t be the last increase we will see…
The first appearance of a significant price increase in SSDs and smartphones with UFS 4.0 in 2024, should we buy now?
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