Flash memory giant Japan's two factories unexpectedly stopped production Smartphone prices are likely to rise

On Feb. 10, chipmaker Kioxia said operations at two factories in Japan that make flash memory chips had been interrupted by contamination of industrial materials, and analysts warned that the emergence could lead to higher prices for key components of smartphones, which in turn could lead to higher smartphone prices.

Kioxia said it suspected that the materials used in the production process were contaminated, resulting in a partial shutdown of the plant, but did not provide further details. The company also said it is working to restore full capacity at its plants in central and northern Japan as soon as possible.

Kioxia's U.S. partner, Western Digital, also confirmed the disruption in production and estimated that the situation would result in a joint venture between the two companies losing at least 6.5 gigabytes of flash memory capacity.

Western Digital said in an interview with reporters that it is working closely with partner Kioxia to implement the necessary measures to restore normal operating conditions as soon as possible.

It is reported that the affected memory chips are called NAND flash memory chips.

Analysts commented that if the production interruption leads to a shortage of flash memory chips, then the price of the product is bound to rise. Some analysts believe that if the supplier delivers bad chemical raw materials to Kioxia, then it is very likely that other NAND flash memory manufacturers will also buy raw materials from the same supplier, and it is not ruled out that it will trigger a greater chain reaction in the future.

Kioxia's website shows that the company, together with Western Digital, has a 35 percent market share in the global flash memory industry. Market research firm TrendForce said in a statement: "The consequences of this incident could push the price of NAND flash memory to soar by 5-10% in the second quarter."

Prior to this incident, TrendForce had predicted a slight oversupply trend in the NAND flash memory market, with average prices in the first to second quarters facing downward pressure.