The Greensheet is Fusion Worldwide's monthly market intelligence report detailing the most significant developments across the memory, hardware, central processing unit, and integrated circuit commodity supply chains. Here are some of the headlines from our latest report:
- SSD and HDD Manufacturers Increase Prices, with Plans to Adjust Costs Further in the Coming Months.
- AMD and Intel Experience Increased Demand in Q1.
- Server Market Activity Continues to Expand.
- Japan Earthquake Triggers Demand in the IC Market.
As shifting pricing continues to influence demand, market intelligence sources signal that this year will see a rise in activity in the identified markets listed throughout this report. With unforeseen events like the January Japan Earthquake, trusted market intelligence is an increasingly valuable tool in supply chain strategies.
Learn more about the market happenings in the full report below.
Demand for Memory Modules Spikes Amidst Limited Availability
Memory module transactions have multiplied significantly following heightened market demand in the wake of 2023. This spike is mainly focused on DDR4 modules, as customers began to build buffer stock at the end of the year, which consequently limited allocation and market availability.
SSD Manufacturers Q1 Pricing Officially Released
Manufacturers officially released SSD cost adjustments for Q1 in January. Pricing across all manufacturers went up 15% - 35% on all series. Allocation remains limited, especially for high-capacity SSDs.
While availability has improved slightly compared to last quarter, reports indicate that the current allocation cannot cover the full extent of orders. Demand has fluctuated as customers monitor supply and pricing to determine when to place their orders. Additionally, end-customer projects have been postponed or delayed due to the approaching Lunar New Year, which occurs from February 10th to February 24th. However, this has not stopped manufacturers from planning added price adjustments for the end of Q1.
Growing Need for Storage Drives NAND Flash Market Rebound
Lower demand throughout 2023 led to a significant decline in the NAND market. Pricing dropped steadily, resulting in NAND flash being sold at production cost for most of the year. In response, Samsung and other flash memory manufacturers reduced production by as much as 50%.
Demand for storage and memory technologies was still minimal, but this changed at the end of the year, and there is now a rebound in the market. The growing need for storage and utilization of the latest technologies, including NAND, DRAM, and CXL advancements, is likely the main driver behind this rebound.
Hardware
Nvidia's RTX 40 GPUs Unveiled at CES 2024
Nvidia took the opportunity to unveil its latest product offerings at CES, which included the RTX 4080 Super, RTX 4070 Ti Super, and RTX 4070 Super GPUs. At the event, AI was a major topic, so Nvidia showed how these GPUs are compatible with on-device AI tasks.
On top of the announcements for new products, Nvidia also recently stated that the last order shipment date for the A100 will be February 23rd. Orders are subject to NCNR terms, and Nvidia will fulfill delivery for all quantities within the year.
Manufacturers Increase HDD Costs
Most HDD manufacturers have increased their pricing, citing SOC and integrated circuit material shortages as the main reasons for the adjustment. In addition, the production cuts implemented throughout last year have also driven manufacturing costs higher.
Costs for 20TB HDDs have reportedly risen by 20% within European markets. Seagate was among the companies that adjusted their pricing, increasing costs for large-capacity HDDs by 5% to 10% in early January. Western Digital is among those struggling with material shortages, and production capacity has been impacted.
Vendors have shared that costs will likely rise by at least another 5% to 10% within Q1.
Networking Product Supply Constraints Continue in 2024
After a year of supply constraints, the networking product industry continues to see the same demand and supply patterns in 2024. Demand remains high, and the supply of high-end networking products remains short as Tier 1 customers receive priority for allocation.
Booking lead times for high-end series switches, NICs, and optical transceivers are still extended. Customers searching for shorter lead times are heavily relying on alternative market sources to ensure continuity of supply.
PC Market Activity Improves at the Beginning of Q1
Market activity improved for the Intel Core and AMD Ryzen Notebook Processors, with mounting inquiries for the Intel 12th Gen Alder Lake, 13th Gen Raptor Lake notebook processor, and the AMD Ryzen 7030 series. Based on recent demand trends, market research is optimistic that the upcoming forecast for global PC shipments will recover in 2024 after outperforming expectations at the end of 2023.
Moreover, the latest launch of notebook CPUs on the Intel Meteor Lake and AMD Ryzen 8000 Ryzen series promise improved performance and designated AI integration, aligning with demand across consumer markets.
Currently, capacity constraints are concentrated on the Intel ATOM CPU small core items, such as the J and N series. Lead times have stretched, and pricing has increased by about 10%. The Embedded Elkhart Lake J6412 and J6413, widely used among IPC customers, have already been impacted by the price increment.
Aside from these products, the recently obsolete Gemini Lake Refresh series has also received spot demand.
Server CPU Demand Uptrend Endures
Supply constraints remain the main concern for Intel server CPU customers as demand trends upwards. Cascade Lake and Ice Lake supply is limited as more Tier 1 customers report potential issues with specific SKUs, including the Silver 4210, 4210R, Gold 6226R, 6248R, and 6336Y.
Furthermore, as the adoption of Intel's Sapphire Rapids expands, there are signals that the market may see inventories become unstable as Intel focuses capacity on Emerald Rapids and other series on the company's server CPU roadmap.
For AMD, cost savings remain the driving factor for orders, especially for the older Milan series. While supply allocations seem to be more stable for AMD, demand for their Genoa series is picking up. While vendors are still conservative regarding building inventory, they are more open to discussing realistic target pricing.
Market intelligence experts have indicated that demand for Server CPUs, especially the older ROME series, is increasing. The recent approval of bitcoin EFTs, which occurred in January, has vendors believing that AMD Server CPU demand may increase thanks to the crypto mining industry. The products most likely to benefit from this wave of demand would be the AMD ROME SKUs EPYC 7452, EPYC 7502, EPYC 7402, EPYC 7742, and EPYC 7H12.
Integrated Circuits (IC)
Japan Earthquake Triggers Demand for Competitors
Due to the impact of the earthquake in Japan's Ishikawa Prefecture, customers are turning to competing brands to secure replacements. Until manufacturing can resume at the manufacturing sites affected by the earthquake, lead times and pricing will likely increase amongst the competition.
Murata, one of the companies hit hardest by the earthquake, began to encourage customers to make such moves as they foresaw an inability to support new orders for the foreseeable future. TDK, one of Murata's competitors, is seeing a rise in orders due to the disrupted production. TDK's VLS series has been a successful substitute for the Murata LQ series. Lead times for the VL series have consequently increased and now exceed 14 weeks.
Toshiba, another company still assessing the damage, has seen customers utilize onsemi's NL17 series as a substitute for TC7 Toshiba products.
NXP Encourages Customers to Transition to New Products
Market intelligence sources have indicated that NXP issued a notification regarding the iMX6 MCU. The notice reportedly encouraged customers to transition to newer versions while announcing an increase in the contract price.
Consequently, those unable to make the change fast enough may need to seek alternative options. Many with demand for the AC version of the product have yet to receive approval for the AD version. Therefore, customers have been unsure whether or not they need to make the change immediately or acquire additional stock.
