IQE Plc CEO Jutta Meier is sounding the alarm on what she calls a growing supply crisis in indium phosphide, the compound semiconductor material that quietly powers everything from AI data centers to fiber-optic networks. The culprit: China’s export controls, which have choked off the dominant source of a material the industry can’t easily replace.
The warning lands at a moment when demand for InP substrates is surging and supply is doing the opposite. Average prices for six-inch InP wafers have climbed roughly 250% since the controls took effect, hitting around $5,000 per wafer.
What China controls, and why it matters
Beijing added indium phosphide to its export control list around early February 2025. China accounts for approximately 70% of global indium production.
InP substrates are essential for manufacturing the high-speed chips used in optical communications, the backbone of data transmission. As AI workloads have exploded, so has the need for faster data pipes between servers, which means more InP-based components in data centers worldwide.
