Contrary to the abundance in the NAND Flash market, stock shortages are expected on the controller side. The stock shortage experienced by membrane manufacturers such as TSMC is the basis for estimates.
With the pandemic, the demand for TSMC’s production lines is increasing. In these days when supply is hard to keep up with demand, sub-components of components are as important as any other.
According to TrendForce, production cannot keep up with the demand as a result of insufficient dice from upstream-production facilities at the closer steps of the production ring such as Phison and Silicon Motion to the user, in a period when the abundance of NAND Flash is being explained.
20% price increase expectation from controllers
While most integrated circuit manufacturers are reported to stop taking new orders, manufacturers are considering a 15-20% price increase for the first quarter of next year as the agreement between NAND Flash and memory module manufacturers reaches a significant stage.
Avatar NAND Flash prices continue to fall
On the demand side, due to high sales in Chromebooks and TVs, the demand for 64 GB and lower capacity eMMCs has increased.
The eMMC drives, where NAND Flash manufacturers have stopped technological development and continue to produce only in the current 2D and 64-layer 3D NAND phase, also pulls down the manufacturers’ bit production capacity.
This is a factor that reduces the appetite of NAND Flash manufacturers to produce in this area. If we consider the NAND Flash side as fixed, it seems that the eMMC drives that come with integrated controllers will be directly affected by the expected price increase.
On the SSD side, the production restriction is not expected to affect the SSD market, as most large manufacturers include their own production controller in their drives.
Nevertheless, the report underlines that the lead time for the controller has recently started to increase. Finally, let’s add that with the transition to PCIe 4.0, the increasing cost and problems that may occur in membrane supply have the potential to increase prices.