Samsung Electronics is rumored to be planning to increase NAND flash memory prices by as much as 20%, and now it has decided to renegotiate with major customers to obtain fair and reasonable prices in order to minimize losses in the NAND business.

As the supply and demand situation of NAND flash memory has stabilized recently, Samsung Electronics has been able to get rid of the dilemma of being forced to sell memory at cost price due to oversupply for more than a year.

According to the Chosun Ilbo, Samsung Electronics is preparing to renegotiate prices with major customers of mobile phones, PCs and servers in March and April, and is expected to raise prices by 15% to 20%.

A semiconductor industry source said, "The first-quarter price negotiations between large memory chip manufacturers such as Samsung Electronics and SK Hynix and their customers have not yet ended." "However, as the price of NAND flash memory has been steadily increasing, customers are rushing to buy it." To ensure supply, we are worried that the reduction in NAND flash memory production will continue this year.”

The NAND flash memory market experienced one of its worst periods in history last year, with weak demand coupled with oversupply leading to a surge in inventory. The NAND flash memory businesses of Samsung Electronics and SK Hynix suffered operating losses of nearly US$8.3 billion and US$6 billion respectively last year.

Different from DRAM, there are many suppliers of NAND flash memory, including Samsung Electronics, SK Hynix, Micron, Japan's KIOXIA and the United States' Western Digital. Therefore, even if major manufacturers reduce production, the market will not be able to normalize. change.

Starting from the second half of last year, the supply and demand of the NAND market returned to balance, and Samsung Electronics, SK Hynix, and Micron began to significantly reduce production, causing the capacity utilization rate to fall below 50%. Starting from the fourth quarter of last year, NAND flash memory prices began to show a slow upward trend.

Data from market research firm TrendForce show that NAND flash memory prices have risen for the fifth consecutive month.

TrendForce said, "Even during the off-season, buyers will purchase more NAND flash memories to ensure inventory. Manufacturers are pushing up prices in order to reduce losses, and we expect NAND fixed transaction prices to rise in the first quarter of this year. Up 15% to 20%."

View more at EASELINK