Monday, April 14, 2008
Prices for NAND are showing signs of life. ''MLC NAND prices have been moving up as well as with spot pricing for 8-Gbit MLC strengthening about 8 percent over the past couple days alone. 8-Gbit SLC has stayed pretty stable,'' said Avi Cohen, an analyst with Avian Securities LLC (Boston).
''The move in the spot prices for MLC NAND is likely due to replenishment of very low inventories kept by dealers as pricing was falling and typical seasonal buying in anticipation of: Dads and Grads,'' he said in a report. ''In contrast, speaking with our sources we were told that in the OEM market NAND flash pricing has not yet seen a similar move up and that the market continues to be somewhat weak and oversupplied.''
Others see a similar pattern. ''While a weaker 1Q is largely expected due to poor pricing, we believe investors are more optimistic for 2Q given the recent rebound of NAND spot prices,'' said Edwin Mok, an analyst with Needham & Co. LLC (New York). ''However, we believe the NAND market remains oversupplied and end demand is only seasonal this quarter.''
The optimism for NAND is expected to be short-lived. ''We think the 10-to-15 percent price increase since the beginning of April is a result of pricing control by key chip makers, which is likely to be short-lived,'' he said in a report. ''We believe demand remains seasonally weak and inventory levels at chip makers remain relatively higher. Therefore, even with the recent rebound, we believe ASP is likely to decline another 10-to-20 percent sequentially in 2Q.''
A downturn in the NAND flash market is forcing many vendors to cut production or delay their fabs.
Micron Technology Inc. has recently pushed out the production of a proposed fab in Singapore, while rival Hynix Semiconductor Inc. plans to cut NAND production. Market leaders Samsung Electronics Co. Ltd. and Toshiba Corp. are reportedly not cutting NAND production, according to reports.
By: DocMemory
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