Amidst a sudden surge in demand, the fiber optic communications supply chain faces unprecedented constraints stemming from supply-side rigidity. The core bottleneck underlying this supply-demand imbalance lies not in the fiber drawing or cabling stages, but at the very upstream of the supply chain: the optical fiber preform—a critical material accounting for 60% to 70% of the total cost of fiber optics.
The manufacturing of optical preforms is a highly precise and complex chemical process, characterized by extremely high technological barriers.
Currently, the preform production capacity of China's four leading enterprises (YOFC, Hengtong, ZTT, and FiberHome) is operating at 100% utilization. Even under extreme conditions—and solely through process optimization—capacity can be expanded by a mere 10% to 15%.
This severe lack of supply elasticity stems from the rigid constraints inherent in the preform capacity expansion cycle: from equipment procurement (3–6 months) to installation and commissioning (6–8 months), and finally to process optimization (3–6 months), the entire expansion cycle spans a lengthy 18 to 24 months.
During the industry's downturn between 2021 and 2024, companies maintained a cautious stance regarding capital expenditures and refrained from undertaking large-scale capacity expansions; consequently, marginal or "long-tail" production capacity was largely eliminated from the market. When demand driven by AI applications suddenly exploded in 2026, the supply side was simply unable to respond with sufficient speed. More critically, in pursuit of higher profit margins, fiber optic manufacturers have prioritized the allocation of limited preform capacity toward high-end fiber products. This strategic shift has resulted in an insufficient allocation for standard fiber products, thereby creating a structural supply deficit.
According to forecasts, the global shortfall in fiber optic capacity is projected to reach 180 million core-kilometers in 2026—representing a deficit of 16.4%. This figure far exceeds the shortfall observed during the 2017–2018 market cycle, when the deficit stood at a mere 4.8%. The emergence of this widening "scissors gap" between supply and demand provides a solid, fundamental basis for an anticipated rise in fiber optic prices. Given that optical preform capacity is unlikely to see any significant expansion before 2027, this period of supply tightness is expected to persist for the foreseeable future.
The global fiber optic market has entered uncharted territory. The combination of AI Data center infrastructure build-outs and the new reality of fiber optic drone warfare—dramatically highlighted by the Russia-Ukraine conflict—has created a genuine supply-demand imbalance. Prices for G657A1 fiber core, G652D fiber core, and especially G657A2 fiber core have reached historic highs, and the preform bottleneck suggests this pressure will persist.
For buyers, the path forward is clear: secure reliable partnerships with proven manufacturers. In these times, experience and capacity are the only true hedges against market volatility.
Contact KCO Fiber sales team today to discuss your requirements to get besr price of G652D, G657A1 and G657A2 fiber.