Key Takeaways:
The price of benchmark G652.D bare fiber in China reached a record 83.40 yuan ($12.07) per kilometer in March, a more than 400% increase since May 2025 amid a global supply crunch.
The surge, reported by industry research firm CRU, has pushed prices past the previous cycle's peak of 78.80 yuan/fkm, according to a new UBS report. The price accelerated in March, rising 165% from January and 418% from the prior year.
The price hikes are now a global phenomenon. European G652.D fiber costs jumped 136% since January to €7.94/fkm ($9.10). Prices for G657.A1 fiber, used in data centers, rose 130% in Europe and 69% in the US over the same period, reflecting the tightening supply spreading worldwide.
The sustained rally is reshaping the industry's economics, significantly boosting profit forecasts for major producers like Yangtze Optical Fibre and Cable (YOFC) while increasing costs for data center and telecom network builders. For the first time since November 2018, the benchmark China fiber price has surpassed the European price.
Demand drivers have structurally shifted. While first-quarter fiber optic cable consumption in China was flat year-over-year due to soft demand from telecom operators, booming demand from data centers absorbed the capacity. Fiber manufacturers are reallocating production toward data center applications and other emerging areas like fiber-optic drones. This shift, combined with tight upstream supply of preform rods and restrained industry expansion, has underpinned the price rally.
In overseas markets, demand in Europe, Southeast Asia, and Latin America grew 2% year-over-year in the first quarter. The US market showed exceptional strength, with demand climbing 24% year-over-year, driven by both telecom network construction and hyperscale data center expansion.
Reflecting the new pricing environment, UBS analysts have sharply upgraded their earnings forecasts for industry leader YOFC. The bank now projects the company's 2026 earnings per share will reach 4.98 yuan, a significant increase from the market consensus of 1.85 yuan. UBS expects YOFC's EBIT margin to expand from 11.4% in 2025 to 24.3% in 2026 and 32.9% in 2027.
This article is for informational purposes only and does not constitute investment advice.
