Price is a reflection of supply and demand
Our USB sticks rely on D-Ram memory chips to be fully functional. The main suppliers of these chips are located in Hong Kong, Shenzhen and Taiwan. Every set period these suppliers decide on how many memory chips they are going to make for the coming period. This decision is based on a prediction of the demand.
In layman’s terms; if there are too many chips produced, then the prices will go down the moment suppliers cannot get rid of their last stock. In that case supply exceeds the demand. It also works this way visa versa. When a shortage of memory chips is produced to meet the demand, prices will rise because buyers will compete for them. In this case demand exceeds the supply.
The total requests of memory chips are far more than what the factories expected at the beginning of this period. Therefor the USB stick market is short on chips and has to buy in at a higher price.
An important note is that phones and certain computers use the same memory chips. You can imagine how much volume these factories have to consider producing.
One factor that probably has a major role in the high prices of this moment is the Samsung Galaxy Note 7 call back. This phone is being called back because of the continuously exploding batteries. So now Samsung have to reproduce their entire line of this model, which means buying in millions of memory chips. This has resulted in an unexpected shortage of supply.
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