In 2026, the global optical fiber market experienced a new round of price fluctuations, with some optical fiber products reaching near seven-year highs. This phenomenon is the result of multiple factors, including tight supply of optical fiber preforms (preforms), long expansion cycles for optical fiber production capacity, and the explosive growth of emerging applications such as AI computing power and drones. This article will analyze the logic behind optical fiber price fluctuations from four dimensions: preform supply, optical fiber expansion cycles, changes in application scenarios, and expansion constraints, to help enterprise customers formulate future plans.

I. Optical Fiber Preform Supply: A “Bottleneck” Challenge at the Core of the Industry Chain

Optical fiber preforms are the core raw material for optical fiber manufacturing, and their production capacity directly determines the price trend of the optical fiber market. In 2026, the global supply of optical fiber preforms exhibited the following characteristics:

1. Full Capacity Operation: The optical fiber preform production lines of China's four leading optical fiber companies (YOFC, Hengtong, Fiberhome, and Zhongtian) and overseas manufacturers are all operating at full capacity, with global capacity utilization approaching 100%.

2. Long Expansion Cycle: Optical fiber preform production has high technological barriers, and the expansion cycle can take as long as 18-24 months. Even if manufacturers start expanding immediately, the new capacity will not be available until at least 2027.

Impact: Tight supply of optical fiber preforms led to increased production costs for optical fibers, forcing manufacturers to raise prices to maintain profit margins, resulting in a "cost-push" price increase.

II. Fiber Optic Expansion Cycle: The Contradiction Between Long-Term Investment and Short-Term Demand

Expanding optical fiber production capacity involves several stages, including preform production , fiber drawing, and cable manufacturing, resulting in a lengthy overall cycle. Currently, optical fiber capacity expansion faces the following challenges:

1. Early Capacity Clearing: From 2019 to 2021, the optical fiber industry experienced a downturn, and manufacturers reduced capacity to cope with declining demand. After 2022, although demand rebounded, manufacturers adopted a conservative approach to capacity expansion, with few large-scale investments.

2. Structural Capacity Mismatch: Manufacturers prioritize the production of high-value-added specialty optical fibers (such as G.654.E and hollow-core optical fibers), but their drawing efficiency is 10%-15% lower than that of the mainstream G.652.D, further squeezing the capacity of ordinary optical fibers.

3. Global Capacity Gap: According to institutional estimates, the global optical fiber gap will reach 180 million core kilometers in 2026, with a gap rate of 16.4%, and the tight supply and demand balance will continue until at least the end of 2027.

Impact: The long expansion cycle of optical fiber makes it difficult for supply to respond quickly to the growth in demand, forming a cycle of "the more essential the demand, the more scarce the supply, and the more the price increases".

III. Changes in Application Scenarios: AI Computing Power and Drones Drive Explosive Demand

In 2026, the demand structure for optical fiber will undergo profound changes, with emerging applications such as AI computing power and drones becoming the main growth drivers:

1. AI computing power construction:

1) Data center interconnection: AI training requires high-speed communication across servers , driving a surge in demand for 400G/800G optical modules, which in turn drives up the usage of optical fiber.

2) Data Center Interconnect (DCI): Hyperscale data centers (such as the Meta Louisiana project) require millions of miles of fiber optic cables, driving demand for long-distance transmission.

3) The transmission of computing power inflation: Tech giants such as Amazon, Microsoft, Google, and Meta will spend more than $600 billion in capital expenditures in 2026, mainly for AI infrastructure, with a significant increase in fiber optic procurement.

2. Drone applications:

1) Military drones : Fiber optic transmission is resistant to electromagnetic interference and has become the preferred solution for drone data links.

2) Civilian drones : The demand for fiber optics in logistics, surveying and mapping and other fields is gradually being released.

3. Carrier Market:

1) 5G/6G construction : Operators continue to promote the construction of a nationwide integrated computing network and intelligent computing centers, leading to a rapid increase in demand for optical fibers such as G.652.D and G.654.E.

2) The scale of centralized procurement has expanded : China Mobile's annual demand has reached the level of hundreds of millions of core kilometers, providing basic business support for leading enterprises.

Impact: Emerging applications have significantly increased the density of fiber optic usage, which, combined with the demand from traditional operators, creates a "dual-engine" effect, further exacerbating the supply-demand imbalance.

IV. Expansion Restrictions: A Combination of Technical, Cost, and Policy Factors

Fiber optic capacity expansion is not only limited by production capacity cycles, but also faces the following constraints:

1. Technical barriers:

1) Specialty optical fiber production : G.654.E, hollow core optical fiber, etc. have high technical barriers, and only a few manufacturers have the ability to mass produce them.

2) Self-sufficiency rate of optical preforms : Although the self-sufficiency rate of optical preforms of domestic manufacturers has improved, high-end optical preforms still rely on imports, which restricts the speed of capacity expansion.

2. Cost pressure:

1) Rising raw material prices : Increased prices of raw materials such as optical fiber preforms and helium have driven up the production cost of optical fibers.

2) Energy consumption limitations : The fiber drawing process is energy-intensive, and some regions are tightening the approval process for high-energy-consuming projects.

3. Policy and trade barriers:

1) Impact of antidumping : Although the domestic optical fiber preform industry is basically self-sufficient, changes in overseas trade policies may affect the supply of imported optical fiber preforms .

2) Export controls : Some countries have imposed export controls on high-end optical fibers, restricting the flow of global supply chains.

Impact : Expansion restrictions lead to insufficient supply elasticity. Even with increased demand, manufacturers will find it difficult to rapidly expand production capacity, further driving up prices.

V. Future Planning Recommendations: Capitalize on Industry Cycles and Expand High-End Production Capacity

In response to fluctuations in fiber optic prices, future planning can be formulated from the following perspectives:

1. Secure the supply chain in advance: Establish long-term cooperation with leading optical fiber manufacturers to prioritize the supply of optical fiber preforms and high-end optical fibers.

2. Develop capabilities in specialty optical fibers: Focus on high value-added products such as G.654.E and hollow-core optical fibers to meet the needs of AI computing power, long-distance transmission and other scenarios.

3. Optimize inventory management: Based on demand forecasts, appropriately increase fiber optic inventory to mitigate the risk of short-term price fluctuations.

4. Explore alternatives solutions: In short-distance transmission scenarios, evaluate the feasibility of alternatives such as copper cables and wireless transmission to reduce cost pressures.

In conclusion, the price fluctuations in optical fiber in 2026 reflect a profound restructuring of the industry's supply and demand. Driven by emerging applications such as AI computing power and drones, the optical fiber industry is entering a new boom cycle. Enterprise customers need to grasp the cyclical patterns of the industry and proactively plan for high-end production capacity to meet future market challenges.