issued Saturday, June 20, 2026 · 12:04 PM
[SINGAPORE] China has stepped up scrutiny of indium exports, with some buyers worried that the niche metal sought for next-generation data centers could be added to an export control system that has become one of Beijing’s most powerful trade arsenals.
China produces nearly 70 percent of the world’s indium. Indium is a byproduct of zinc refining, used primarily in displays and solders, but it is also the source of indium phosphide, which is used to make high-speed optical chips for artificial intelligence data centers.
The Chinese government added indium phosphide to its export control list in February 2025, but the ban is enough of a hurdle for next-generation data centers that the CEO of Nvidia-backed chipmaker Coherent raised the issue when he traveled to Beijing with US President Donald Trump in May.
Indium metal is not on the export control list, but two buyers told Reuters about increased scrutiny of purchases from Chinese customs. For the first time this year, European buyers were required to disclose information about their end users, including their location.
A major North American buyer said the approval took several days from the same day because of increased scrutiny of administrative procedures and said they were “nervous.” This buyer was not asked for any additional information by customs.
China’s Ministry of Commerce did not immediately respond to a request for comment on Holidays.
All buyers declined to be named due to the sensitivity of the topic.
The additional due diligence is not uniform, and two other buyers told Reuters they had heard about the additional scrutiny but had not faced it themselves. So far, Reuters has not identified the blocked shipment.
Nevertheless, there are also concerns among small and medium-sized enterprises that this is a harbinger of tighter controls and disclosures to end users that China and other countries with export control regimes will use to chart global supply chains and chokepoints.
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Indium has been identified as a potential vulnerability for the United States, with the Defense Logistics Agency earlier this year announcing a request for proposals to stockpile up to 403 tons of the material over three years.
Another North American buyer said he suspected reporting requirements were “a precursor to export restrictions or outright bans.” Reuters
