Thailand floods spell shortages and price hikes in HDD market


Thailand floods spell shortages and price hikes in HDD market

Simon Quicke

The components market could face shortages as a consequence of the worst floods for decades sweeping across Thailand hitting some of the factories producing storage products for the global market.

The monsoon has sparked some of the worst floods Thailand has known claiming 300 lives with waters covering thousands of miles and threatening to hit Bangkok.

The impact on the channel could be felt from now and well into the first quarter of next year as Thailand is the second largest producer of hard disk drives behind China but already market watcher iSuppli has downgraded its Q4 production forecast in light of the disaster.

Western Digital, the largest vendor in the market in terms of volume, and Toshiba have temporarily halted production of HDDs as their production facilities and workforce were hit by the flooding.

Distributors selling HDDs are already working to ensure that supply doesn't become too much of an issue but there are already warnings that the shortages could well lead to price hikes.

Dave Stevinson, sales director at VIP Computers, said that Seagate had informed it that although its factories were not impacted it relied on parts that came from factories under water and it had suspended its programmes for the quarter.

"This is a blow to the channel and the natural effect of a supply shortage will lead to a price increase. VIP are working relentlessly to secure sufficient inventory for the channel," he said.
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