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Sporadic supplies

December 1, 2011

Thailand is the second-largest supplier of hard disks in the world but the recent floods have put a halt to production and forced prices to rise. The effects are being felt all over the world.

Bangkok residents are finding it difficult to celebrate Loy Krathong
The floods are the worst to hit Thailand in decadesImage: picture alliance / dpa

As the death toll from the worst floods to hit Thailand in 50 years rose to 667, a top Asian Development Bank official warned on Thursday that the natural disaster was a wake-up call to governments across the continent to do more to fight the devastating impact of climate change.

The ADB's leading climate change specialist, David McCauley, said long-term solutions needed to be put in place all over Asia, which is dotted with large coastal cities from Shanghai to Kolkata.

Data released by the Thai government on Thursday showed that the floods had caused widespread damage to farmland and forced food prices to go up.

Still submerged in water

Workers holding hard drives
Hard drives are used in PCs, game consoles and satellite receiversImage: AP

The country's hard disk drive (HDD) sector has also been hit considerably by the floods and manufacturers fear it could be months before production is back to normal. Currently, hundreds of factories are still submerged in water.

Western Digital, a leading US supplier, also has two factories north of the capital Bangkok which are still under water. "We can’t make any hard drives there because the whole supply chain has been broken and we don’t have enough parts," explained company spokesman Daniel Mauerhofer. "It's a problem for the whole HDD sector, not only for us."

He added that at other factories, even though the floodwaters have receded, it will take time to rebuild storerooms and get machines back into operation. He said that Western Digital would only make 20 million hard disks this quarter, compared with 50 million in the previous one.

Houses submerged in water
Much of Thailand was submerged by the floodwatersImage: AP

Rising prices

Björn Bartsch from the German IT company Alternate is also concerned about the rise in prices. "In August, a two terabyte hard disk cost between 60 and 70 euros. Now, they go for 200 euros."

But the German IT association Bitkom said this would not affect the overall price of computers in the short run. It said that computers for the Christmas season had already been made and were ready for delivery.

However, observers are worried the prices could rise early next year. This could affect not only the price of PCs but also of satellite receivers and game consoles, which also need hard disks. Manufacturers as far off as China have started getting jittery as they import many parts from Thailand and are worried they will not be able to assemble electronic goods in time.

Analysts do, however, expect production and the supply chain to get back to normal within about six months.

Author: Shenjun Liu / act
Editor: Sarah Berning

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