China, which produces nearly 70% of the world's indium, is increasing scrutiny over exports of the metal. Indium is critical for high-speed chips used in AI data centers, and buyers now face new information requests and delays. The move has sparked fears of a formal export ban, prompting the U.S. Defense Logistics Agency to plan a strategic stockpile of up to 403 tons.
China indium export scrutiny
- ▪China is increasing scrutiny over its exports of indium, leading some buyers to fear it may be added to an export control regime
- ▪A major North American buyer reported that approval times for indium purchases from China have increased from same-day to several days
- ▪A European buyer of indium was asked for the first time in 2026 to disclose information about end users
- ▪A North American buyer suspected that new reporting requirements are "a precursor to restrictions or outright bans on exports."
Indium supply chain dominance
- ▪In February 2025, China placed indium phosphide on an export control list
- ▪China produces nearly 70% of the world's indium, which is a byproduct of zinc refining
AI data center applications
- ▪Indium is the raw material for making indium phosphide, which is used for high-speed optical chips in AI data centers
- ▪The CEO of Nvidia-backed chipmaker Coherent traveled to Beijing with President Donald Trump in May to raise the issue of indium phosphide restrictions
U.S. strategic stockpiling response
- ▪The U.S. has identified indium as a potential vulnerability for its supply chains
- ▪The U.S. Defense Logistics Agency released a request for proposals in 2026 to stockpile up to 403 tons of indium over three years
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