① South Korea's solid-state drive exports in August increased by 249.8% year-on-year; ② AI servers drove demand recovery, and major overseas manufacturers collectively raised the prices of solid-state drives; ③ Institutions estimate that the contract price of solid-state drives in the third quarter will increase by 15% compared to the previous quarter, and the original factory revenue will increase by nearly 20% on a quarterly basis.
On September 13, the Science, Technology and Information and Communication Department of South Korea released data showing that ICT exports in August this year increased by 28.5% year-on-year to $20.6 billion, maintaining growth for 10 consecutive months and double-digit growth for 8 consecutive months.
Semiconductors play a major role in South Korea's export industry, with semiconductor exports in August growing by 37.6% year-on-year. Specifically, the export value of storage semiconductors increased by 71.7% year-on-year to $7.29 billion, and the export value of system semiconductors increased by 2.7% to $4.07 billion.
It is worth noting that the export value of computers and peripheral equipment in August increased by 144.2% year-on-year, with the export value of solid-state drives (SSDs) increasing by 249.8% year-on-year to $1.25 billion.
Solid-state drives are computer storage devices that use solid-state electronic storage chips as the storage medium. The composition of solid-state drives includes a control unit and storage unit (such as FLASH chips and DRAM chips). Due to the absence of mechanical moving parts inside, they are smaller, lighter, more resistant to shock, and compared to traditional mechanical hard drives, they have higher read/write speeds, lower noise, lower power consumption, and higher shock resistance.
Enterprise-grade solid-state drives typically use advanced flash chips and optimized control chips, providing higher read and write speeds compared to consumer-grade solid-state drives.
Data centers have higher requirements for the performance, stability, and reliability of solid-state drives. The AI wave has driven an increase in demand for enterprise-grade solid-state drives, leading to a gradual differentiation in the market conditions of the two categories.
AI servers driving demand recovery, overseas major manufacturers collectively raising SSD prices
According to the latest survey by TrendForce, the demand for enterprise solid state drives (Enterprise SSD) has significantly increased in the second quarter of 2024 due to the surge in Nvidia's GPU platform and AI applications, as well as the rising demand from server brands.
AI is driving the demand for large capacity SSDs, but due to the suppliers' failure to adjust production capacity in a timely manner for the first half of this year, there is a significant supply shortage. As a result, the average price of enterprise solid state drives in the second quarter has increased by more than 25% month-on-month, and the original factory revenue has increased by more than 50%.
According to incomplete statistics from the Science and Technology Innovation Board Daily:
Samsung Electronics plans to raise the prices of enterprise level SSDs in its NAND department by 20% - 25% in the second quarter of 2024.
Western Digital: According to the flash memory market, on April 8th, Western Digital issued a price adjustment letter stating that due to strong demand for flash memory and hard drive products leading to tight supply, it announced price increases for all of its hard drive products, involving various HDD and SSD product lines.
Micron: According to FlashTech News on April 9th, due to strong demand for cloud servers and enterprise storage, Micron has proposed price increases for Q2 products to most of its customers. The price increase for DRAM and SSD is over 20%. Several customers have learned that Micron intends to continuously increase the prices of DRAM modules and SSDs by more than 25% in the second quarter of 2024, reflecting the gradually improving demand.
Looking at the third quarter, TrendForce predicts that the demand from customers of North American cloud computing service providers will continue to increase, and server manufacturers will maintain strong ordering momentum, which will further drive the purchasing capacity of enterprise solid state drives. As the supply shortage continues into the third quarter, the institution estimates that contract prices will increase by 15% month-on-month, and original factory revenue will increase by nearly 20% quarterly.
However, unlike the hot market for enterprise solid state drives, the prices of consumer-grade SSDs continue to decline due to technological advancements and economies of scale.
Flash memory chips are a key component of SSD, and their cost largely determines the cost of the SSD. In recent years, the cost of flash memory chips has been continuously decreasing, directly leading to the decline in the cost of consumer-grade SSDs and further driving the price down.
Furthermore, the SSD market is highly competitive, with numerous brands and manufacturers using price wars and promotional activities to attract consumers in order to compete for market share. This competition has led to continuous price decreases in order to gain a larger market share, driving the sustained decline in the price of consumer-grade SSDs.