A critical AI niche is dominated by one little-known Japanese company

Imagine a sheet made of microscopic glass fibers, woven by a former silk maker and thinner than a human hair.

- Yang Jie

A type of ultrathin glass sheet, used in advanced chips, is in short supply and prices are up sharply

(REUTERS)

A shortage of this material—essential in artificial-intelligence chips—is looming over companies including Apple and Nvidia.

The cloth-like material known as T-glass comes almost entirely from a single century-old Japanese textile company called Nittobo that doesn’t expect to bring significant new capacity online until late this year.

“T-glass is difficult to make, and it will not be easy for competitors to catch up with Nittobo any time soon,” said Noritsugu Hirakawa, an analyst at Daiwa Securities.

The shortage of T-glass is an example of the stresses caused by the artificial-intelligence boom. AI companies are gobbling up memory chips and other electronic parts, and makers of those parts are snapping up materials.

People in the industry say AI companies such as Nvidia have the deepest pockets and often get preferred access to parts. Yuta Nishiyama, an analyst at Citigroup, said shortages were likely to center on consumer electronics because these products are getting lower priority.

“New production lines coming online will not be enough to close the gap between supply and rapidly rising demand,” Nittobo said.