Indium Phosphide Wafer Product

Overview

Indium phosphide is the semiconductor that converts electrons to light and back at the wavelengths optical fiber carries best (1,310 and 1,550 nm). Every long-reach optical transceiver in a data center has InP inside it: the laser that transmits, often the modulator that encodes, and the photodetector that receives. Silicon cannot lase; gallium arsenide does not reach these wavelengths efficiently. For the optics that link AI clusters together, InP has no drop-in substitute.

Why it is hard to make

At its 1,062 °C melting point, indium phosphide exerts roughly 27 bar of phosphorus vapor pressure — left open, the melt boils its own phosphorus away. Synthesis of Polycrystalline InP therefore happens in sealed high-pressure vessels, and crystal growth runs under a layer of molten Boric Oxide Encapsulant that caps the melt inside a pBN Crucible. A InP Seed Crystal is dipped through the glass and withdrawn slowly, pulling up the InP Single-Crystal Boule. The boule is then ground, sliced by Wire-Saw Slicing, and polished to the epi-ready Polished Epi-Ready Wafer on which device layers are grown by MOCVD. The crystal is brittle, the diameters small, and the yield discipline closer to jewelry than to silicon: this is why InP wafers cost hundreds of dollars while silicon wafers cost tens.

The supply chain

Both feedstocks have concentrated chains. The indium comes from Refined Indium (1 kg ingot), of which China refines about 70% as a byproduct of its zinc-smelting industry. The phosphorus route runs from Phosphate Rock through electric-furnace White Phosphorus (P4) to semiconductor-grade Red Phosphorus (semiconductor grade) — and thermal phosphorus production is likewise concentrated in China, Vietnam, and Kazakhstan.

In February 2025 China placed export controls on indium phosphide itself. Reuters reported in June 2026 that these controls have become a chokepoint for the US data-center buildout, since the wafers feed directly into the 800G-class optical transceivers that AI clusters consume by the million. Wafer supply outside China runs through Sumitomo Electric and JX Metals in Japan and AXT — whose production subsidiary, Beijing Tongmei, sits inside China and inside the control regime.

Where it goes from here

Each wafer is diced into thousands of laser or detector chips, so wafer counts are small even when transceiver volumes are huge — which cuts both ways: a modest number of wafers supports the industry, and a modest restriction disturbs it. Substitution efforts center on silicon photonics, which still needs an InP laser attached, and on quantum-dot lasers grown on silicon, which remain early.