You should look at the total difficulty including BTC and BCH https://fork.lol/pow/hashrate which appears to be relatively flat. New capacity coming on line is probably bottlenecked on Bitmain who more or less has a monopoly on ASICs.
It dropped because of the bitcoin cash/bcash/BCH fork. Some miners went to the new chain, for a while it was possible to game the BCH chain to get a faster reward, this meant for approx 2 weeks a lot of hashing power left bitcoin causing the next difficulty adjustment to be down. As the other commenter pointed out Bitmain have a bit of a monopoly at the moment but there is a new company offering chips soon so we could see a significant increase in the next 6-12 months as these chips come online.
