Commodities
Home›Commodities›Industrial Metals›Indium phosphide substrates jump on AI-driven data cen…
Indium phosphide substrates jump on AI-driven data center demand
Two-inch wafers reached as much as 880 yuan per wafer in June, while three-inch wafers rose to about 3,200 yuan, and further price hikes of up to 10.0% are being discussed for the fourth quarter.
The AI boom is pushing up demand for optical components used in data centers, and indium phosphide substrates are now at the center of a sharp price spike, according to a report by SCMP Economy. Indium phosphide is used to make lasers that convert electrical signals into light for faster transmission through fiber-optic cables.
SCMP Economy cited a Nomura report that tracks industry expert views, saying two-inch indium phosphide (InP) substrates surged to as much as 880 yuan, or US$130.54, per wafer in June, up from as little as 500 yuan at the end of 2025. Over the same period, three-inch wafers rose to about 3,200 yuan from about 1,800 yuan.
China is a major producer of InP, and an InP index compiled by Wind that tracks more than 20 mainland-listed firms gained 4.2% on Monday. SCMP Economy also said the industry was considering additional price increases that could reach 10.0% in the fourth quarter.
Other suppliers have also moved, with JPMorgan noting that Japan’s JX Advanced Metals was introducing a first round of revisions that could raise prices to two to three times previous levels. The bank added that customer inquiries continued to exceed the company’s planned capacity expansion.