As the overall supply of NAND flash memory device controllers is limited, memory chip suppliers have turned to sources from flash memory device controller manufacturers, including Samsung, Micron and other NAND flash memory chip suppliers that have increased demand for more controller chip production to third parties. Third-party suppliers place orders, such as Phison and Huirong Technology.
DIGITIMES, citing sources, reported that Phison expects the supply of flash memory device controllers, especially those based on the 55nm process, to remain tight until 2023, and estimates that the supply gap for 55nm chips is about 40%. This has led flash device controller vendors to phase out production of older generation USB and SD 2.0 devices and necessarily prioritize their 3.0 chip supply to specific partners for profit reasons.
As strong demand for automotive chips, CIS sensors, and OLED display driver chips occupies the additional 28nm capacity of foundries, Huirong Technology expects that the supply of 28nm chips will remain tight through 2023.
On the other hand, the shortage of SSD control ICs is expected to continue into 2022 due to tight upstream logic IC wafer capacity and the shortage of ABF substrates used in BGA packages. In terms of control ICs required for large-capacity SSDs, whether the shortage can be alleviated depends on the situation in the third quarter.
Local memory packaging and testing companies said that there is still a problem of uneven supply of materials, and the memory supply is oversupplied. However, the upstream capacity of mature processes such as 28nm used in SSD NAND control chips continues to be tight. Based on the strategies of memory chip customers, companies that have their own control IC and module businesses will naturally keep some of these products for their own use. This allows mid-sized memory packaging and test companies to take over from Phison and others. Current order visibility is good into the third quarter.
The bulk products of major SSD manufacturers such as Micron and Intel require outsourcing control chips. Licheng Technology, which has large testing and packaging capabilities, has not felt the impact of uneven supply.
Relevant companies said that the growth of batch SSD module packaging and testing business is expected to rebound significantly in the second half of 2022, and the shortage of control ICs is expected to ease in the third quarter. Memory packaging and testing plants are also actively seeking more ABF capacity and control IC suppliers, hoping that the SSD packaging and testing business will grow in the second half of 2022.
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