Jakarta, INTI - China has reportedly begun tightening controls on exports of indium, a key raw material in the artificial intelligence (AI) chip industry.
According to a report by Investing on Saturday, June 20, several buyers expressed concerns that Beijing imposed restrictions on indium exports in the near future.
Currently, China accounts for nearly 70 percent of global indium production. The metal is a byproduct of zinc refining mostly used in displays and solder but also the raw material for making indium phosphide, used to make high-speed optical chips for AI data centers.
Since February 2025, the Chinese government has included indium phosphide in the list of goods subject to export controls. This policy is considered to have posed a challenge to the development of next-generation AI data centers.
Although indium has not yet been officially included in the export restrictions list, two buyers told Reuters that Chinese customs authorities are now conducting stricter oversight of purchases of the metal.
Strict Procedures were Experienced by Some
One European buyer said that for the first time this year, they were asked to provide details about the end user, including the location where the material is used.
Meanwhile, a North American buyer reported that the export approval process, which previously could be completed in one day, now takes several days. However, the buyer was not asked to provide additional information by customs.
On the other hand, not all buyers have experienced the stricter procedures. Two other buyers said they were aware of additional inspections, but they have not experienced them directly.
Indium has also been identified as a strategic material that could potentially pose a weakness for the United States. Earlier this year, the US Defense Logistics Agency proposed stockpiling up to 403 tons of indium over three years to anticipate potential supply disruptions.
Conclusion
China has begun tightening controls on exports of indium, a key material used in the manufacture of AI chips. As the producer of nearly 70 percent of the world's indium supply, China's policies could potentially impact the development of next-generation AI data centers. While indium is not yet on the export control list, some buyers have reported stricter customs inspections, including requests for end-user information and longer processes.
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