Indium phosphide wafers see sharp price jump in AI supply chain

AI infrastructure costs rise as China supply chain tightens

Indium phosphide (InP) wafers for AI data centers experienced significant price increases in early 2026. Two-inch wafers rose from 500 yuan (end of 2025) to 880 yuan by June 2026, while three-inch wafers jumped from 1,800 yuan to 3,200 yuan over the same period. The Wind index tracking Chinese InP firms surged 4.2% on August 17, 2026, and Economic Daily News reported potential 10% price hikes for substrates in Q4 2026. Japanese supplier JX Advanced Metals also signaled plans to raise prices to 2-3 times current levels.

This friction in the goods sector threatens to slow global AI adoption and increase service costs. As InP wafers are critical for AI infrastructure, their rising prices could constrain affordability for data centers and related services. The Chinese-focused index and potential Q4 hikes suggest supply chain constraints are tightening, though the full impact remains speculative. This signal reflects the source's limited scope; full context requires the original report.

Source: SCMP Tech