NAND supply/demand to balance next year

NAND demand has exceeded supply in all six quarters since Q3 2016.

The NAND bit supply growth rate is currently projected at 42.9%, while the bit demand growth rate is projected at 37.7%.

“The progress bottleneck in the transition from the 2D-NAND to the 3D-NAND manufacturing for non-Samsung suppliers has been the main reason why the NAND Flash supply has been tight through 2017,” says DRAMeXchange’s Alan Chen, “some losses of production capacity occurred as non-Samsung suppliers strive to improve their respective 3D-NAND production processes. At the same time, suppliers have been unable to effectively utilise the additional capacity that they have taken on.”

The increase in supply is because the non-Samsung suppliers are expected to reach maturity in the development of their respective 64-and 72-layer stacking technologies in 2018.

Q1’s traditional demand slowdown will see supply supply overtake demand in Q1 only to return to equilibrium for the rest of 2018.

3D-NAND is expected to represent over 70% of the NAND bit output for 2018, up from 50% in 2017, as Hynix, Toshiba and Micron/Intel increase 3D NAND capacity.
Samsung, which started 64-layer production in Q3, will retain technology leadership.