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Quake Drives NAND Prices Up 5 to 15 Percent

Contract prices for NAND flash memory have increased by up to 15 percent because of the earthquake in Japan, according to researcher DRAMeXchange in Taiwan.

Immediately after the March 11 earthquake, there was an increase in spot market prices for NAND because of concerns of potential shortages. However, contract prices did not immediately increase.

Because of the shutdown of silicon wafer production in Japan and damage to work-in-process (WIP) at Toshiba and SanDisk's Yokkaichi plant, NAND flash suppliers began to increase contract prices in the second half of March, reported DRAMeXchange.

Average prices for NAND flash increased 5 to 15 percent in March, although some manufacturers lowered prices for some products sold to memory card manufacturers in order to boost sales, according to DRAMeXchange.

Due to damage to facilities and power outages, NAND flash memory production in Japan in the second quarter will decline, resulting in a four percent decline in global NAND output.

The shutdown of Shin-Etsu Chemical's Shirakawa plant, which produces silicon wafers, will impact NAND production. The facility accounts for about 20 percent of global silicon wafer capacity. Due to rolling blackouts and damage to the plant and equipment, there is still no definite date for production to resume at the plant.

Despite the decline in NAND output, NAND flash buyers can expect contract prices to be stable in April because prices already increased in March, and demand is expected to decline in the second quarter, reported DRAMeXchange. As electricity is restored, and production of wafers and chips resumes, contract prices for NAND will decline later in the second quarter.

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