In the latest Optical Fibre and Cable Market Outlook, CRU examines the recent acceleration in fibre pricing and the tightening supply conditions emerging in early 2026.
After an extended period of subdued pricing in several regions, optical fibre prices are rising sharply alongside sustained demand growth. Chinese G.562.D bare fibre prices surged by more than 80% between November 2025 and January 2026, pushing China prices above Europe and India. This is unprecedented development in the recent years and the first time in over seven years that Chinese prices exceeded European levels. This shift signals a change in the underlying balance between supply and consumption, with tightening upstream constraints meeting continued infrastructure investment.
The pace of recent price increases marks a departure from the relative stability of the past few years. Conditions are adjusting quickly as demand strengthens across multiple applications at the same time.
AI infrastructure drives structural demand growth
Global cable demand remains robust, supported by hyperscale and AI data centre expansion. In the US, large-scale data centre deployments are pushing hyperscalers to secure large volumes of optical cable, while suppliers are dedicating more resources and capacity to serving this demand.
As bandwidth requirements increase, hyperscalers are leveraging high fibre count cable solutions and evaluating next-generation technologies, including hollow-core fibre and multicore fibre. These developments point to a structural increase in fibre intensity per AI data centre rather than a cyclical uplift.
Demand strength is also evident beyond AI infrastructure. Rising A2 fibre requirements, including applications linked to fibre-tethered drones, have added to global fibre consumption. At the same time, firm export flows into North America have tightened fibre availability in other regions. For now, these trends show limited signs of slowing, though questions remain around how long current growth rates can be sustained.
Preform tightness becomes the defining constraint
While demand growth is central to the current momentum, supply constraints are increasingly shaping market outcomes. Glass preform has become a critical bottleneck in the value chain. Although preform capacity may appear sufficient, particularly in China, effective utilisation is significantly high once mothballed capacity is excluded. Many Chinese suppliers are currently operating near capacity limits.
Restarting idled preform capacity requires time, technical preparation and capital commitment. Capacity cannot be restored immediately, and meaningful additions are likely to take months rather than weeks. In the interim, some fibre producers without integrated preform capability face challenges in securing stable supply. Rising preform costs have fed directly into higher optical fibre prices, contributing to the recent sharp increase in global price indices.
Strategic implications for 2026
The interaction between sustained demand growth and limited upstream flexibility has reshaped the operating environment for optical fibre and cable markets. Price direction is now closely linked to preform availability, restart timelines and the pace of infrastructure deployment.
For market stakeholders, this increases the importance of supply visibility and procurement strategy. The margin for imbalance appears narrower than in recent years, particularly if AI-driven infrastructure investment continues at its current pace. At the same time, uncertainty around demand durability and capacity recovery introduces greater complexity into planning and negotiations.
As 2026 progresses, the key question is not only how prices move, but how long structural tightness persists. The answer will influence sourcing strategies and investment decisions across the value chain.
