On June 20, according to the latest survey by TrendForce Memory Research (DRAMeXchange), as the Sino-US trade dispute heats up, the demand for smartphones and servers will be lower than originally expected in this (2019) year. Coupled with the shortage of CPU continues to drag the notebook shipments, eMMC / UFS, SSD and other products shipments may also be lower than expected in the third quarter peak season, the contract price decline is difficult.
In the first half of this year, OEMs are focusing on destocking various products, and the momentum of stocking is weak. The average contract price of NAND flash has dropped by nearly 20% for two consecutive quarters, and there is no market price rebound. TrendForce said that despite international tensions and other unfavorable factors, demand conditions in the third quarter are still expected to improve, and contract price declines may slow. However, as the supplier's inventory has not been completed, shipments in the second half of the year may drop sharply, so it is difficult to see the rebound in contract prices.
For eMMC/UFS and SSD, which constitute the mainstream of the market, smartphone and notebook PC suppliers are expected to increase their stocking capacity in the third quarter. In addition, the previous two quarters have undergone a large price correction, so the contract price is expected to decline. The two seasons will have to slow down, about 10%. In terms of product manufacturing, 64/72 layer 3DNAND is still the main process of eMMC/UFS, and its market is mainly composed of mobile devices, while the 92/96 layer 3DNAND process has wider visibility and helps in client SSD. cut costs.
As for the contract price of the wafer in the marketing channel, the current transaction price is quite close to the cash cost, which causes the supplier to be unwilling to further reduce the price. Therefore, the strategy will be the priority of eMMC/UFS, SSD and other product requirements, unless the inventory level is unbearable, otherwise there will be no positive action on the wafer contract price, some suppliers even hope to restore 256Gb products to Profitable price. TrendForce said that due to the weak market, wafer prices are unlikely to come back, but the decline in the next few months is expected to remain within 5%.