Ruminations on the electronics industry from David Manners, Senior Components Editor on Electronics Weekly.
Toshiba Halves NAND Output
A shudder must have gone through the consumer electronics industry with the news that Toshiba is cutting its NAND output by half in May and June.
Toshiba is citing the lack of availability of raw wafers and other materials caused by the earthquake.
The company is not putting the reason for the cut-backs on any damage caused to its own factories.
The supply of NAND flash was short before the earthquake. Late in March, bankers JP Morgan forecast that the supply of NAND flash would be down around 30% in May and June.
The bankers’ note read: ‘The NAND market will likely remain supply-constrained for several months, and contract prices will likely continue to rise in the near term (spot prices are up 15% since the earthquake).’
Toshiba had about 40% NAND market share before the earthquake hit. Its NAND fabs are at Yokkaichi, about 200 miles South of Tokyo and about 600 miles south of the worst hit earthquake areas.
Although Toshiba has not made any statement about the state of its NAND output, it is likely that the original earthquake, the continuing tremors and the persistent power outages will have affected its ability to supply customers quite apart from the shortage of raw materials.
In a market that was tight before the earthquake, any interruption will have a substantial effect on the consumer electronics market where all portable devices rely on NAND for memory storage.
The wild card is how much NAND market leader Samsung can do to boost NAND production to make up any shortfall. Bearing in mind it takes three months to make a chip, even if Samsung increased NAND wafer starts by 30% immediately after the earthquake hit, it will be the second week in July before that extra product reaches the market.Tags: contract prices, factories, market leader, tremors, wafers