Rare "MSG": Worsening supply-demand mismatch pushes germanium prices up over 80% in half a year

The driving force behind this round of price surge is the strong demand for optical fiber in areas such as AI computing infrastructure. In optical fiber manufacturing, germanium tetrachloride plays a key role akin to “MSG” in enhancing performance. It is the core raw material for doping the fiber core of optical fiber preforms, primarily used to boost the refractive index of the fiber core, thereby improving transmission capabilities. "In the raw material cost of optical fiber preforms, the proportion of germanium is quite low, but due to high downstream requirements for germanium material purity, coupled with concentrated domestic germanium supply and strong irreplaceability of the material, the supply-demand imbalance for germanium is more pronounced compared to other materials," explained a leading optical fiber preform manufacturer. Regarding the continuous rise in germanium prices, Shanghai Ganglian analyst Chen Qiqi stated that the reasons are tight raw material supply and increased demand. In the short term, germanium product costs are supported by high bidding prices for raw materials. Furthermore, due to a significant increase in demand for optical fiber, solar cells, and military applications this year, germanium ingot prices are expected to fluctuate at high levels in the short term, and maintain an upward trend in the long term. Some institutions predict that the growth rate of demand for optical fiber-grade germanium products will remain between 15% and 20% over the next two years.