Recently, the storage industry has seen a trend of price pump, which may just be the beginning. According to reports from Taiwanese media, the DRAM and NAND flash memory markets are facing severe supply shortages, which are worse than previously expected. It is anticipated that storage chip prices will continue to rise in the fourth quarter of 2023 and into 2024.

There are two main reasons for this situation. First, global cloud computing service providers have significantly increased their order volume for 2024. Currently, the inventories of the three major storage manufacturers (SK Hynix, Micron, and Samsung) are already stretched thin, and they may not be able to meet customer demand in the future. Second, traditional hard disk drive (HDD) manufacturers have all cut production, and industry insiders expect this could lead to at least six months of supply shortages, forcing some orders to shift to solid-state drives (SSD), further exacerbating the tension in the NAND supply chain.

In this case, several manufacturers in the global storage industry have begun to adjust prices. Following the price increases announced by SanDisk, Micron, Samsung, and Western Digital, major storage module manufacturer ADATA also announced recently that it would stop quoting DDR4 prices starting September 29 and prioritize the supply of DDR5 and NAND flash memory to key customers. At the same time, NAND flash controller chip manufacturer Phison has recently resumed quoting for some products, with prices rising by about 10%, seen as a signal that the NAND flash market is about to experience a comprehensive rise.

Industry insiders generally believe that the price rise of storage chips in the fourth quarter of 2023 has become a foregone conclusion. Although the contract price for October has not yet been finalized, the upstream manufacturers' attitude towards price increases is more resolute than ever, and the increase may exceed previous expectations. According to previous forecasts, the contract price of DDR5 is expected to rise by 10%-15%, with spot prices rising by 15%-25%; the contract price increase for DDR4 is expected to exceed 10%, and the spot price increase is expected to exceed 15%.

The recent trend of rising prices for storage chips is worth paying attention to, as it not only reflects the current changes in the market supply and demand relationship but may also trigger a chain reaction throughout the entire electronics industry. Consumers and businesses may need to pay higher prices for storage devices, while it may also drive innovation and efficiency improvements in related technologies.