Q2  server DRAM ASPs will be up 20% q-o-q, says TrendForce, while SSD ASPs will increase 10-15%.

Memory suppliers are now facing low inventory levels, which encourages them to maintain the 2Q20 price upsurge.

The US government’s JEDI contract and demand for teleworking services are stoking demand.

Demand from China’s cloud service operators rose considerably in February with orders from Alibaba and Tencent driven mainly by their telework arrangements.

ByteDance has more server orders than anticipated for the deployment of its data centers in North America because its portfolio has expanded to include e-commerce, gaming, and fintech.

The growing demand for server DRAM has led to low inventory levels for both clients and suppliers while the supply of server DRAM has become much tighter, which is pushing ASPs upwards.

Demand for enterprise SSDs began to rebound in 4Q19, while data center operators in North America continue to increase their orders for servers and server memory products in 1Q20.

In the Chinese market demand for enterprise SSDs has increased due to the increased need for cloud services and the stay-at-home economy.

The influx of additional and urgent orders outside of normal contract transactions has overwhelmed NAND Flash suppliers, which earlier adopted a cautious stance with regards to raising production capacity. There is a high probability that the undersupply of NAND Flash will cause the demand surge to carry over to 2Q20.

As the demand for enterprise SSD continues to rise, PC and smartphone OEMs have not slashed their flash memory orders, thus exacerbating the NAND Flash shortage in 1Q20.

TrendForce’s latest survey of the NAND Flash market finds that PC and smartphone OEMs are struggling to quickly accumulate enough component inventory because the whole production and shipment period for actors in the supply chain has been extended to more than two weeks due to the outbreak.

Hence, the supply of NAND Flash will remain very constricted in 2Q20. NAND Flash suppliers are also in a much stronger position when negotiating prices with their clients. Considering the latest market situation, TrendForce has updated the price forecast of enterprise SSDs for 2Q20 and corrected up the QoQ increases to the 10-15% range.