Severe flooding in Thailand will cripple hard disk drive (HDD) supply chainsfor 56 days, according to a report from IT provision company, Probrand.
Thailand, which produces or supplies parts for about 70% of the world’s HDDs, was hit with the worst flooding on record in July, and much of the country is still under water. Probrand estimates that the area’s HDD supply chain will be out of action for almost two months.
Massive global shortages of HDDs are predicted in the first quarter of 2012 as the disaster has hit the supply chain harder than the Japan Tsunami did, according Probrand’s Iain Bowles.
"At the start of the floods in Bangkok, the IT industry had four weeks of finished disk drive stock in the supply chain," Bowles said. "If the rains stop today it will be a minimum of 56 days before production can re-start. Thai authorities have said it will take two to four weeks to pump out flooded areas and that is even before any actual clean up can start.
"Stock levels in the supply chain act as a cushion for supply continuity but in this case, the HDD stock ‘buffer’ of finished products is simply too small given most plants will remain under dirty water for some time yet."
According to Probrand, most of the key HDD producers have confirmed disruption in their supply chains due to the floods. Western Digital, Seagate, Hitachi Global Storage Technologies, Toshiba/Fujitsu and Samsung Electronics are all effected.
"For manufacturers, I suspect we will see attempts to move production to other geographies such as Malaysia," Bowles said. "However, much of the specialist machinery required to switch production sites is under water and cannot be accessed via flooded roads."