China's Indium Phosphide Export Curbs Push Wafer Prices Up 250%; Coherent CEO Joins Trump in Beijing for

In early May 2026, Jim Anderson, chief executive of U. S. chipmaker Coherent, told investors the company was facing a shortage of indium phosphide. He subsequently joined President Donald Trump on a trip to China in an effort to secure export licenses. Indium phosphide, a compound that converts electricity into laser light, is used for data transmission between chips inside data centers. As artificial intelligence systems scale up, data centers are shifting from copper cabling to fiber-optic communications, making indium phosphide a critical material.

China accounts for roughly 70% of global indium phosphide supply and began restricting exports of the material in February 2025, leading to a sharp rise in prices. The price of indium phosphide wafers has surged 250% (from $2,000 to $5,000 per wafer, according to context). Supplier Lumentum has sold out its supply through 2028. AXT, the world's second-largest wafer manufacturer, produces most of its output in China and has faced delays in obtaining export licenses. During the U. -China trade truce in November 2025, China lifted restrictions on gallium, germanium, and antimony, but left the indium phosphide ban unchanged; the restrictions remain in place through June 2026.

On the influence front, in June 2026 OpenAI released a report saying it had banned two clusters of accounts linked to China. One cluster, named "Data Center Trend," posted comments and cartoons claiming that data centers drive up household electricity bills. The operation had little impact. U. officials have warned about such influence activities. Representative Brett Guthrie has asked the FBI and the Technology Advisory Board to investigate foreign influence campaigns, while Representative Jason Smith said his investigators traced Chinese funding to U. nonprofit organizations and urged the Treasury Department to revoke their tax-exempt status. Several groups involved in anti-data-center campaigns, including CODEPINK, The People's Forum, and Tricontinental, have been linked to a funding network associated with Neville Roy Singham, an American businessman based in Shanghai.