Fiber Optic Cable Prices Surge 80%: Is a New Market Cycle Beginning?

The fiber optic sector just had a moment.

On Friday, the entire fiber optic concept sector exploded on the Chinese stock market.

Hangzhou Cable (Hangzhou Dianlan 杭州电缆), Changjiang Communications (Changjiang Tongxin 长江通信), YOFC (Changfei Guangxian 长飞光纤), and Hengtong Optic-Electric (Hengtong Guandian 亨通光电) all saw massive gains, with some hitting daily price ceilings.

But here’s what’s actually wild—the underlying reason for the rally: fiber optic prices are breaking records.

We’re talking about gains that haven’t happened in years.

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Some Fiber Optic Quotes Surge Over 80% in 2026

• January 2026 Average: Over ¥35 RMB per fiber km ($4.86 USD)
• Peak Quotes: Exceeding ¥40 RMB per fiber km ($5.56 USD)
• Market Milestone: Seven-year high reached in the Chinese market
• YTD Growth: Rare surge of over 80% in total price value

Let’s get into the numbers, because they’re genuinely striking.

According to Securities Times (Zhengquan Shibao 证券时报), institutional research shows that in January 2026, G.652.D single-mode fiber—the industry standard—hit a seven-year high in the Chinese market.

We’re talking about average prices exceeding ¥35 RMB ($4.86 USD) per fiber kilometer.

Some quotes have even broken past ¥40 RMB ($5.56 USD) per fiber kilometer.

That’s a year-to-date increase of over 80%—a genuinely rare surge for an industry that typically moves in smaller increments.

To put that in context: this is the kind of price movement that makes investors and industry players take notice.

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What Even Is Fiber Optic Cable?

If you’re not deeply embedded in telecom infrastructure, here’s a quick primer.

Fiber optics—short for optical fibers—are filament-like transmission media made from high-purity quartz glass.

The core principle is straightforward:

• Light signals travel through the fiber core
• They bounce off the interface between the core and cladding using the law of total internal reflection
• This continuous reflection allows signals to travel long distances at high speeds with minimal signal loss
• Result: long-distance, high-speed data transmission without significant degradation

In short, fiber optic cables are the backbone of modern data infrastructure—everything from internet connectivity to cloud computing depends on them.

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Why Is Demand for Fiber Optics Exploding Right Now?

China’s digital economy is expanding rapidly.

The “East Data West Computing” (Dongshu Xisuan 东数西算) project—a massive national initiative to distribute computing resources—is ramping up significantly.

This alone is driving substantial demand for fiber optic cables.

And here’s the kicker: the industry is currently experiencing a rare sweet spot—what analysts call “rising prices and volumes” (量价齐升).

This means both the price and the volume of fiber optics being sold are increasing simultaneously, which is generally a bullish signal for the entire sector.

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Two Major Factors Driving the Fiber Optic Price Surge

Price doesn’t move 80% in a year for no reason.

According to research from Yongxing Securities (Yongxing Zhengquan 甬兴证券), there are two primary drivers—one on the demand side, one on the supply side.

Factor #1: AI-Driven Demand Is Skyrocketing

The rapid growth of AI computing power is creating massive new fiber optic demand.

Here’s specifically what’s driving this:

• Multi-mode fiber demand within data centers is surging
• G.654.E fiber for long-distance, high-speed transmission is being deployed at scale
• Next-generation products like hollow-core fiber are emerging

G.654.E fiber is particularly important here.

It has two key advantages: low attenuation and resistance to non-linear effects.

This makes it ideal for the backbone networks of China’s three major telecommunications operators and the State Grid (Guojia Diwang 国家电网), where they’re deploying 400G/800G high-speed optical transmission systems.

The numbers are staggering.

According to Communications Weekly (Tongxin Chanye Wang 通信产业网), in the first 11 months of 2025 alone, the three major operators collectively procured approximately 3.1782 million fiber kilometers of G.654.E fiber.

That’s a 25-fold increase compared to the previous year.

Let that sink in: 25x growth year-over-year.

Factor #2: Supply-Side Constraints Are Creating Bottlenecks

While demand is exploding, the supply side is getting tighter.

This is where it gets interesting from an economics perspective.

Fiber preforms are the core raw material used to manufacture fiber optic cables.

Here’s what’s happening on the supply side:

• Core manufacturers are being cautious with capacity expansion
• The “long-tail” capacity—smaller-scale manufacturers producing basic products—has basically been cleared from the market
• Expansion cycles for preforms take over two years, meaning new supply can’t hit the market quickly
• Since the last industry trough, smaller-scale “long-tail” capacity has exited the market entirely
• Global preform capacity growth remains slow, creating supply rigidity

The capacity picture globally is illuminating.

According to Communications Weekly (Tongxin Chanye Wang 通信产业网), global fiber preform capacity in 2025 is approximately 25,000 tons, with China accounting for 62%.

Here’s the critical part: as capacity shifts toward high-demand AI and specialty fibers, the supply of traditional products like G.652.D has become more orderly and controllable.

With rapid inventory consumption and constrained supply, prices have naturally entered an upward channel.

This is textbook supply-and-demand economics playing out in real time.

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Leveraged Funds Are Betting Big on Fiber Optics

Institutional money is noticing this opportunity.

Data from East Money Choice (Dongfang Caifu Choice 东方财富Choice) shows that 12 fiber optic concept stocks have seen net purchases by leveraged funds so far this year.

Here’s the breakdown:

Top Fiber Optic Stocks by Leveraged Fund Accumulation

• TFC Optical Communication (Tianfu Tongxin 天孚通信): ¥2.4 billion RMB ($333.3 million USD) in net margin purchases—ranking first
• FiberHome Telecommunication Technologies (Fenghuo Tongxin 烽火通信): Over ¥500 million RMB ($69.4 million USD) in second place
• YOFC (Changfei Guangxian 长飞光纤): ¥100–340 million RMB ($13.9–47.2 million USD) range
• Raycus Laser (Ruike Jiguang 锐科激光): ¥100–340 million RMB ($13.9–47.2 million USD) range
• G&H/CASTECH (Guangku Keji 光库科技): ¥100–340 million RMB ($13.9–47.2 million USD) range
• Futong Information (Tongding Hulian 通鼎互联): ¥100–340 million RMB ($13.9–47.2 million USD) range
• Tefa Tyco (Taichenguang 太辰光): ¥100–340 million RMB ($13.9–47.2 million USD) range
• Yangtze Optical Electronic (Changyingtong 长盈通): ¥100–340 million RMB ($13.9–47.2 million USD) range

When leveraged funds—essentially the “smart money” of institutional traders—are accumulating positions, it’s a signal they see continued upside.

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Wall Street (and Beijing) Think a New Cycle Is Starting

Institutional research firms are increasingly bullish on fiber optics.

CICC: AI Is Reshaping the Entire Fiber Optic Market

China International Capital Corporation (CICC 中金公司) pointed out that AI is profoundly reshaping the demand for fiber optic cables.

Their thesis: the industry is pushing toward a new supply-demand cycle, with an expected supply shortage within the next two years.

Minsheng Securities: The Industry Is Entering a 2-3 Year Boom Cycle

Minsheng Securities (Minsheng Zhengquan 民生证券) provided historical context.

They point out that the industry experiences strong cyclicality driven by supply-demand mismatches:

• 2015-2017: Price hike driven by demand growth and preform shortages
• 2018-2020: Demand slump and overcapacity
• 2021-2022: Supply-demand improvements and clearing of small manufacturers
• Currently: With 5G+F5G construction and the “East Data West Computing” project accelerating, the industry is poised for a 2-3 year boom cycle

Guosheng Securities: Fiber Optics Are In a Price Recovery Cycle

Guosheng Securities (Guosheng Zhengquan 国盛证券) is tracking two distinct demand drivers:

Domestic demand:

• Acceleration of FTTR (Fiber to the Room) deployments
• Rapid expansion of data center layouts across the country

Overseas demand:

• Network construction in India, Europe, and America is bolstering global demand

The takeaway: fiber optic cables have entered a price recovery cycle, with dual domestic and international drivers lifting prices from historical lows and providing stronger core business support for sector companies.

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The Bottom Line: A New Fiber Optic Cycle

The fiber optic sector isn’t just having a good week—it appears to be at the beginning of a meaningful structural cycle.

Here’s what’s converging:

• Explosive demand from AI data centers and computing infrastructure
• Constrained supply from cautious capacity expansion and long manufacturing cycles
• Institutional validation from major investment firms and leveraged fund accumulation
• Government tailwinds from projects like “East Data West Computing” and 5G/F5G infrastructure buildouts
• International opportunities in India, Europe, and America

Whether this becomes a multi-year boom cycle or corrects in the near term remains to be seen.

But one thing is clear: the fiber optic cable market is experiencing a rare alignment of bullish fundamentals—and investors are already taking notice.

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References

• “量价齐升”！部分狂涨80% 光纤新周期开启？(附表格) – East Money (Dongfang Caifu 东方财富)
• Industry Analysis and Market Trends – Securities Times (Zhengquan Shibao 证券时报)
• 2025 Fiber Preform Capacity Statistics – Communications Weekly (Tongxin Chanye Wang 通信产业网)
• AI’s Impact on Fiber Optic Infrastructure – CICC (Zhongjin Gongsi 中金公司)