The price for NVIDIA's top-tier 'Blackwell' B300 AI server in China has surged to an astonishing $1 million, nearly double its price from late last year. This isn't just a simple price hike; it's a clear signal of a market under intense pressure from geopolitics and law enforcement.
The core of the issue lies in a severe supply squeeze, driven by a two-front blockade. First, the U.S. government has strict export controls preventing the most advanced AI chips, like the B300, from officially entering China. An attempt to supply a slightly less powerful alternative, the H200, also hit a wall. While the U.S. conditionally approved its export, the Chinese government has reportedly blocked its import, likely to promote domestic alternatives. This has effectively shut down the main, legal supply route for high-end NVIDIA chips.
With the front door locked, buyers turned to the back door: the 'gray market'. However, this channel has also been squeezed. In March 2026, U.S. authorities indicted a co-founder of a major server company in a massive smuggling scheme. This high-profile crackdown sent a chill through the gray market, making it far riskier and more difficult to source these servers unofficially. The illicit supply, which had been a crucial alternative, suddenly became unreliable.
Compounding this supply crisis is an explosion in demand. While supply channels were being choked off, China's appetite for AI computing power was growing dramatically. According to Morgan Stanley, China's share of global AI token usage skyrocketed from 5% to 32% in just one year. This created a classic economic dilemma: far too many buyers chasing far too few goods.
Ultimately, the $1 million price tag is the result of this perfect storm. Strong demand from a booming AI sector collided with a supply chain crippled by both U.S. export bans and a crackdown on illegal smuggling. This has created a massive 'scarcity premium', forcing Chinese companies to pay a high price for the world's best AI hardware or pivot to less powerful domestic options.
- Gray Market: An unofficial market where goods are traded through legal but unintended or unauthorized distribution channels. It's different from a 'black market,' where the goods themselves are illegal.
- Scarcity Premium: The extra amount a buyer is willing to pay for a product that is in short supply. In this case, it's the price difference between the B300 server in the U.S. and in China.