Phison Electronics expects a shortage of materials for manufacturing NAND flash memory chips
Over the past year, the cost of SSDs has plummeted to unprecedented lows. However, as major NAND flash memory manufacturers have significantly cut production and strategically raised prices, a rebound from rock-bottom SSD pricing has begun to materialize recently.
According to Digitimes, Phison Electronics, a dominant player in the NAND flash market, has indicated that a shortage of raw materials for NAND flash chips is imminent, which suggests that SSD prices will likely surge, thus concluding this period of affordable storage.
Given Phison Electronics’ substantial market share in SSD controller chips, their market forecasts have historically been reliable. In fact, since 2019, demand in the SSD market has been in decline. Nevertheless, the year 2023 may mark the steepest price drop in SSD history, with production consistently outstripping market demand and price reductions being employed as a primary promotional tool to boost sales. In recent months, many manufacturers have been actively depleting their inventories, leading to a stabilization of SSD prices, and those once-popular budget SSDs have now become scarce.
Despite the ongoing capacity reduction by NAND manufacturers, the impending material shortage may further constrict supply. For NAND manufacturers, this could be construed as positive news; the industry has been incurring losses due to oversupply, with accumulated deficits potentially amounting to billions of dollars. The CEO of Phison even stated in May that if the market does not recover swiftly, bankruptcy for some manufacturers might ensue.