In the upcoming quarter, TrendForce predicts a 0-5 percent increase in the average selling price (ASP) of NAND Flash wafers, as suppliers continue their assertive pricing approach.
However, despite an anticipated surge in demand in the second half of 2023, cautious inventory management by buyers is preventing the stabilization of NAND Flash prices. The prices of SSDs, eMMCs, and UFS, which are module products, are expected to decrease, leading to a price hike for NAND Flash wafers in the third quarter.
TrendForce estimates a decline of approximately 3-8 percent in the ASP of NAND Flash in 3Q23, with a possibility of prices rebounding in 4Q23.
Challenges Persist for Client SSDs as Oversupply Remains
Though a recovery in notebook shipments is expected in 3Q23, reversing the oversupply situation for client SSDs will pose challenges. Some suppliers have resorted to promotional activities to secure customer orders and meet shipping targets. Consequently, the ASP of client SSDs is projected to decrease by 8-13 percent in the third quarter.
Enterprise SSDs Find Hope in Stimulated Shipments
Orders from Chinese government agencies, telecom operators, and second-tier e-commerce and internet service providers are anticipated to boost shipments of enterprise SSDs for new server platforms in 3Q23. However, suppliers are currently operating at a loss for NAND Flash products, resulting in shrinking bargaining margins. The decline in ASP of enterprise SSDs is expected to converge to 5-10 percent in 3Q23. The positive effects of reduced production are likely to become gradually evident in the second half of 2023.
Stable Prices for eMMCs with Varying Capacities
Demand for eMMCs remains sluggish, and suppliers reduced prices for small-capacity eMMCs in 2Q23, leaving little room for further declines. Therefore, prices for small-capacity eMMCs are expected to remain stable in 3Q23. On the other hand, large-capacity eMMCs used in industrial equipment and Chromebooks may experience stable prices due to lower customer demand. The price trend for large-capacity eMMCs is likely to follow that of same-capacity UFS, implying the potential for further price drops.
UFS Demand Gradually Strengthening, but Challenges Persist
Smartphone OEMs are leveraging the relatively lower prices to build up their component stock levels, gradually strengthening procurement activity for UFS. However, overall UFS shipments may not meet expectations, as the boost from seasonal demand and new product releases is modest. TrendForce predicts an 8-13 percent decline in the average contract price for UFS in the third quarter.
Suppliers Poised for a More Assertive Pricing Stance on NAND Flash Wafers
Suppliers of NAND Flash wafers are expected to experience reduced inventory pressure in the third quarter, leading to a more assertive pricing strategy. There is a high probability that contract prices in the third quarter will reach a low point and then rebound, stimulating purchasing interest among buyers. This growth could accelerate the balancing of supply and demand, sustaining an upward pricing trend.