Storage Shortages Incoming: Coronavirus Afflicts Storage Device Makers in SE Asia

News
By Niels Broekhuijsen
published

Small disruptions, big consequences

(Image credit: Shutterstock)

As the Coronavirus spreads around the world and leads countries to enforce lockdown regulations in order to 'flatten the curve,' industries are getting hit all around the world. The latest to fall victim is the storage devices industry, which resides for the most part in Malaysia and the Philippines in Southeast Asia.

As reported by Storage Newsletter, HDD manufacturing in the Philippines has halted for a minimum of three days, and other storage(-related) manufacturing has also come to a crawl or stopped entirely. These slowdowns are a consequence of the Coronavirus spreading throughout the area. 

Storage industries operate on very lean manufacturing methods with 'just-in-time' supply chains, meaning that relatively small disruptions in one part of the chain can have lasting effects on the industry's economies. As little as a one week outage could ripple through the storage supply chain in no time, creating measurable price spikes mere weeks after incidents. An event such as the Coronavirus that causes weeks, if not months, of labor and parts shortages can have a devastating effect on such industries, taking years to recover from.

The situation reminds us much of the Thailand floods in 2011, from which the markets took years to recover, with some arguing that prices technically still haven't recovered fully.

We must also factor in that in this crisis, more and more people are working from home, putting pressure on network operators to keep data running smoothly. This has lead to an increase in demand for networking products, but will also lead to increased demand for storage products as content providers attempt to bring their media closer to the end-consumer, reducing long-distance data travel.

Either way, it was already expected that storage prices would be on the rise, as the current prices were at an all-time low right before the Coronavirus outbreak.

For shoppers, this doesn't mean that you should go out and stock up on hard drives for the next decade. However, if you're in need of a new hard drive or SSD in the next few weeks, it might not be a bad idea to enjoy the low storage prices while they last.

Niels Broekhuijsen
Niels Broekhuijsen

Niels Broekhuijsen is a Contributing Writer for Tom's Hardware US. He reviews cases, water cooling and pc builds.

7 Comments Comment from the forums
  • King_V
    Storage Shortage...

    UGH, that makes me so ANGRY . . angry at that phrase that features rhyme AND alliteration simultaneously! Angry because... I didn't think of it first.
    Reply
  • InvalidError
    Globalization of manufacturing chains is nice when it all works properly, not so nice when different parts of the economy are shutting down at different times and completely screw it up for everyone, especially companies that rely heavily on LEAN/JiT to avoid having any stock that isn't spoken for in advance.
    Reply
  • King_V
    No margin for error or disruption, and no bufffer?

    No surprise when something goes wrong. Shame is that every business is trying to cut things to the bare minimum. Just barely the amount of supply. Just barely the amount of staff. Etc.

    It feels like a house of cards. Made with the cheapest, flimsiest playing cards they could find.
    Reply
  • digitalgriffin
    One of the reasons traditional HDD prices have been collapsing is because the demand isn't there as SSDs replace them. Both Seagate and WD have been consolidating plants for this reason. They do have excess capacity. It will not be difficult for them to spin back up once things return to normal. I predict no price spike unless it's an excuse to buffer their bottom line.
    Reply
  • Gurg
    Just purchased a new 500gb Samsung 970 Evo + M.2 for $109 to replace my 5 year old Kingston HyperX 240gb M.2 that contained Window and hardware software. The old m.2 was about half as fast and for some reason was starting to have problems being recognized when booting. My motherboard has two M.2 slots and the two 500gb EVO s will provide more than enough storage for my needs. I quit using both hard drives and old SSDs in my desktop a few years ago.

    The need for large capacity old style SSDs and hard drives is diminishing for home use as M.2s and other online storage solutions become available and relatively affordable. Eliminating those also allowed me to go to a smaller footprint case than my old Corasir A540. Hoping my next build will have room for at least two or possibly three M.2s.
    Reply
  • cat1092
    Just an excuse to jack up pricing!:mad:

    Already see that Newegg has jacked up the price on the Ryzen 7 3700X big time, close to $100 overnight, due to Amazon no longer filling orders until further notice. Am sure they'll do the same with drives of all types.

    There's been times when the pricing on Amazon was higher anyway, so it's just Newegg seizing the moment to line their pockets. The FTC should step in and not allow price gouging during this time. We need the economy to flow, this is an example of huge company lining their pockets, while at the same time will have their hands sticking out for stimulus cash once an agreement is reached.

    Note that there is no shortage of CPU's, just retailers hiking prices in a national emergency. Newegg & other retailers should be ashamed of themselves for these actions.

    Any of these drives were in the supply chain long ago, as I stated in 2011, a shortage is when there's none and customers are on a waiting list. Due to high price gouging, that didn't happen, many turned to eBay to purchase perfectly working used models.

    Consumers should stand up and buck the trend, many has all the drives needed & then some, other than PCIe 4.0 devices. I have three unopened PCIe 3.0 NVMe SSD's & two SATA-3, plus numerous new & used drives not in use at this time. This is why it's best to stock up when drives (& RAM) are low in cost, because on a moment's notice, pricing doubles the next day.

    Have long decided to pass up on X570, since AM4 will receive only one more CPU & PCIe 5.0 will be here in 2021. Once pricing settles, will build a new PC. Until then, can wait, have near a dozen PC's and plenty of repair parts, to include sealed PSU's. The reason why I have supply is because I stock during promos. :D

    Cat
    Reply
  • z0d
    This is true. I have a friend who was working in a Toshiba HDD factory in the Philippines and due to the enhanced community quarantine or lockdown they stopped production temporarily.
    Reply