Standard logic components are in a state of allocation as suppliers continue to struggle to ﬁll backlogs and decide on potential expansion plans, according to the market research firm iSuppli Corp.
Unlike some of the other component categories, standard logic—i.e., general-purpose digital devices such as gates, flip-flops and registers used to manage and route digital signals—had been maintaining average lead times of 10 to 12 weeks in the first quarter of 2010, well within normal parameters.
However, all that changed in April as demand began outstripping supply. Shortages and price increases on standard commodities such as copper and aluminum have contributed to the current situation, pushing lead times to the 18- to 20-week level, matching that of other components experiencing similar constrained conditions.
Pricing on standard logic has been rising across the board for the better part of a year, increasing in range from just a fraction of a percentage to up to 8 percent in a single month in some cases.
iSuppli expects standard logic will continue to experience an increase in Average Selling Prices (ASPs) and suffer a continued lack of supply for the remainder of 2010 and into 2011. The possibility exists, however, that this segment might see some supplier adjustments and relief in the first half of 2011.
Nonetheless, given the current allocation in which the entire component industry finds itself, time will tell if enough adjustments are done to make a difference in present market conditions.