Japan Disaster Sparks Flash Memory Price Rise, Worry About Mobile Supplies


Credit: Toshiba

Prolonged disruptions in supply chains and power networks in Japan could pose trouble for a host of consumer electronics companies, especially mobile device makers.

The concern relates to a key part of any modern mobile device–flash memory–and the constraints that key suppliers like Toshiba may face as Japan struggles to recover from the disaster unfolding ever since a massive earthquake struck just off its northern coast Friday. The price of flash memory rose 17 percent in chip-trading markets in Asia Monday, according to The Wall Street Journal, which could have ripple effects across the mobile industry as the price of adding storage to mobile devices increases.

Most major mobile-device manufacturers lock in flash-memory prices months or even years in advance to isolate them from short-term spikes in price such as the one playing out this week, but there’s still potential for problems if they have trouble getting their hands on enough chips to satisfy their production needs. Toshiba, the second-largest supplier of flash in the world, was forced to shut down one chip-making factory in order to assess the damage from the earthquake, and while it told the WSJ there didn’t appear to be any major damage to the facility it remains shut down indefinitely.

And unfortunately flash memory is just one of the important mobile-device components produced by Japanese companies, which includes displays, diodes, and glass panels. Making matters worse, Japanese electric power companies are scheduling rolling blackouts to deal with losses in capacity as several nuclear plants are teetering on the verge of a separate disaster. Obviously the country has more pressing concerns to deal with at the moment than the global consumer electronics supply chain, but such activity makes up a decent portion of Japan’s economy and plays a key role in manufacturing activities in China and Taiwan.

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