Spot prices for finished optical fiber have climbed to between 2.8 and five times their 2025 levels, or higher, as demand from AI data centers outstrips supply, market research firm TrendForce said on October 19, 2026. The firm expects shortages to persist “until at least 2028,” because new production capacity takes 18 to 24 months to bring online.

TrendForce estimated 2026 global demand at 577 million fiber-kilometers, against a supply shortfall of 180 million fiber-kilometers. It said “global optical fiber capacity utilization has climbed to 92% in 2026, while inventory levels have fallen from four months in 2024 to just one month.” Some leading suppliers are booked into the first quarter of 2027, according to the firm.

Data center cabling rises most

The increases vary by fiber type. TrendForce said bend-insensitive fiber (BIF), used for cabling inside data centers, has risen to more than five times its 2025 level in 2026. Fiber used for AI backbones, covering data center interconnects and high-capacity backbone networks, is at about 2.8 times 2025 levels, while mainstream telecom fiber is at about 3.7 times previous levels.

The firm attributed the squeeze mainly to data center construction. “TrendForce notes that substantial demand from AI data center-related applications has tightened global optical fiber supply since late 2025,” the release said. Hyperscale cloud providers are continuing to expand AI data centers, while chipmakers and telecom operators invest in data center interconnects and backbone networks. Data centers account for about 18% to 20% of fiber demand in 2026, a share TrendForce projects will reach 30% to 35% in 2027.

Relief is slow to arrive because existing capacity is nearly full and expanding preform capacity requires new deposition equipment and process setup, typically taking 18 to 24 months. That limits how quickly supply can grow in the near term, the firm said.

Buyers move to long-term contracts

TrendForce said telecom operators are shifting from short-term purchases to long-term agreements (LTAs) to secure supply, and that locking in fiber early through LTAs is expected to become increasingly common among operators and large infrastructure providers. It pointed to a multi-year agreement signed in September under which Verizon and Corning agreed on 129 million fiber-kilometers, or about 80 million fiber-miles, of high-density fiber and connectivity solutions for delivery from 2027 to 2032.

Verizon’s announcement of that deal on September 8 described it as a multi-year, multi-billion dollar agreement but did not disclose its value. Verizon said the fiber would support its push toward 40 million to 50 million broadband passings and build the long-haul backbone required by AI hyperscalers, with ultra-dense cables deployed along major corridors under its AI Connect strategy to link data centers. The agreement is also designed to help Corning keep scaling its US manufacturing footprint, the release said.

“Securing this volume of fiber allows us to continue building the network of the future at an unprecedented scale,” said Kyle Malady, CEO of Verizon Business.

Part of a wider hardware squeeze

The fiber shortage adds to supply pressure elsewhere in data center hardware. In a September 30 forecast, TrendForce projected conventional DRAM contract prices to rise 10% to 15% quarter over quarter in the fourth quarter of 2026 and NAND flash contract prices to rise 15% to 20%. It said bit demand for enterprise SSDs is projected to grow by more than 80% year over year in 2026 as cloud providers expand AI inference infrastructure, but that “most incremental supply has already been committed, leaving little available on the open market.”

Why it matters

The steepest increase in TrendForce’s figures is in bend-insensitive fiber for cabling inside data centers, the category that matters most to organizations building or upgrading their own facilities or fitting out colocation space. Network and facilities projects that assumed 2025 cabling costs are working from figures that, on TrendForce’s numbers, are now several times too low for spot purchases.

TrendForce did not address enterprise purchasing directly. But its findings that some leading suppliers are booked into early 2027, that inventory has fallen to about a month and that large buyers are locking in supply through long-term contracts all point to limited room for short-notice orders. The same pattern of committed supply appears in its memory forecast, where it said little enterprise SSD supply is left on the open market.

What to watch

TrendForce expects data centers to take a larger share of fiber demand in 2027, while new preform capacity takes up to two years to arrive. Further long-term supply agreements between fiber makers and large buyers would be consistent with the shift the firm describes.

The caveats

The figures are TrendForce estimates and forecasts rather than audited industry data. The release names only one supply agreement, does not identify fiber manufacturers other than Corning, and does not say how prices have moved for buyers on long-term contracts compared with the spot market.

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