Market research company DRAMeXchange predicts that NAND memory based products will become cheaper next year, due to an oversupply of the memory. With cheap NAND, it’s very like also prices of SSDs will drop considerably.
The oversupply is mainly caused by lower demand. DRAMeXchange expects a drop in demand of 15% in the first quarter of 2018, compared to the fourth quarter of this year. The first quarter traditionally has lower demand, after demand in the Holiday season traditionally increases.
Mainly NAND memory for laptops, tablets and smartphones is less popular. Demand for NAND memory used in servers is expected to remain the same.
Besides the oversupply, there is also an increase in production capacity due to the continuously growing market for NAND based products Especially Chinese smartphone manufacturers were fueling an increase in demand after which NAND manufacturers built new production facilities. Because NAND manufacturing processes also improve over time, yields also increase, resulting in a higher output per fab.
DRAMeXchange therefore expects a higher production of 5% in the first quarter of next year, compared to the fourth quarter of this year. It’s unclear how much the lower demand and increased production will affect the market, as DRAMeXchange doesn’t predict how much prices will drop.
SSDs are expected to benefit most from the forecasted lower prices of NAND, because they are pretty much made up entirely of NAND memory chips. The price drop will likely also be temporarily, prices are expected to raise again in the second half of next year, which is traditional peak season.