1H’Dec. mainstream MLC NAND Flash contract price rebounded 3-11 percent triggered by the Toshiba’s power outage accident

TAIWAN: According to DRAMeXchange, the research department of Trendforce Corp., although inventory replenishment peak for year-end hot sales is over, some memory card and UFD makers are re-stocking in small volume given the dropping inventory level at early December, it resulted in the stabilizing NAND Flash price.

At the expectation of shipment decline in January and February impact from the power outage in Toshiba’s NAND Flash planet in Yokkaichi on Dec. 8, end-customers are initiating earlier for the re-stocking and result in the 3-11 percent mainstream MLC contract price rebound in 1H’Dec.

However, still some vendors implemented price promotion strategy in early December and result in price decline in some chips.Source: DRAMeXchange.

According to Toshiba’s rough estimation, despite of no shipment impact in December, yet the power outage will likely impact the shipment as much as 20 percent in January and February, and the output will be back to normal status in March.

DRAMeXchange expects the max accident impact on the 1Q11 global NAND Flash supply decline may be up to 5 percent and turn the 1Q11 NAND Flash market into mild shortage from over-supply if no new output is added from other vendors in the quarter.Source: DRAMeXchange.

Given the lower inventory level and the catalysis of Toshiba’s power outage news, the re-stocking movement has warmed up from mid-December.

We expect NAND Flash price to stop falling and mildly rebounding into mid-January in the short run that the following rebound momentum will still be highly determined by the real market demand from Christmas holiday sales, restock demand for Chinese New Year holiday, and if the additional demand from real sales of new smart phone and tablet PC launches in 1Q11 can help offset the slow season effect in retail memory card market.