📈 Why Optical Fiber Prices Are Increasing
1. AI Data Center Boom
👉Hyperscalers like Meta, Microsoft, and Google are building massive AI data centers.
👉AI workloads require high-bandwidth, low-latency fiber connections, pushing demand far beyond normal telecom growth.
👉Fiber demand is now outpacing production capacity globally.
2. Military Applications
👉In the Russia–Ukraine war, FPV drones are being connected via fiber cables to avoid radio jamming.
👉These drones use bendable G.657.A2 fiber, adding unexpected military demand.
👉Military procurement competes directly with civilian telecom and AI infrastructure buyers.
3. China’s Supply Bottleneck
👉China produces the majority of the world’s optical fiber.
👉Since late 2025, Chinese vendors have been at full capacity, with longer lead times and unstable quotations.
👉Domestic projects (FTTH, 5G backhaul) consume large volumes, leaving less for export.
4. Geopolitical & Logistics Issues
👉Conflicts in regions like the Middle East disrupt shipping routes, raising logistics costs.
👉Raw material shortages (silica preforms, energy-intensive production) further inflate manufacturing costs.