Generated by Codex with GPT 5.6 Sol High

The Iran war has created a shortage in a commodity most people rarely notice. Sulphur is recovered while refineries strip impurities from oil and gas, which makes it a by-product of fuel production rather than something suppliers can quickly produce on demand. With Gulf refineries cut off from world markets and Ukrainian strikes disabling Russian capacity, the same disruption driving up diesel prices is also squeezing sulphur supplies.

That matters far beyond energy. Sulphur is converted into sulphuric acid for mining, fertiliser production and semiconductor manufacturing. The resulting price shock is already forcing miners to slow work and fertiliser companies to make less nutritious products. A material once treated almost as industrial waste is becoming another strategic commodity whose availability depends on vulnerable trade routes and geopolitical stability.

A tight market loses its biggest supplier

Sulphur was scarce even before fighting closed the Strait of Hormuz. Russia, seeking to protect domestic fertiliser and mining companies, reduced its exports from 4.8m tonnes in 2025—about 15% of globally traded supply—to 1.8m tonnes so far in 2026. Houthi attacks complicated Saudi shipments through the Red Sea, while the threat of American tariffs cast doubt over Canadian supply. By February Middle Eastern bulk sulphur cost about \$500 a tonne, up from \$340 a year earlier.

The Hormuz crisis then trapped nearly a quarter of global production and half of seaborne exports in the Gulf. Shipments briefly recovered after a June agreement between America and Iran released stranded cargoes, but fell again when the ceasefire collapsed in July. They remain roughly two-thirds below their pre-war level.

There is no easy detour. Ports on the Red Sea and Oman’s coast are handling no more sulphur than they did before the war. Moving a single 30,000-tonne cargo overland would require about 1,000 lorries, and much of the available trucking equipment is designed for molten sulphur rather than the solid material carried by bulk ships. Argus Media expects Middle Eastern exports to fall below 11m tonnes this year, little more than half the 20.5m tonnes shipped in 2025.

The shock has encouraged other countries to protect their own users. Russia extended its ban, and India, Kazakhstan and Turkey suspended exports after the war began. Higher shipments from America and Canada have not filled the gap: non-Gulf exports remain about 40% below their pre-war level.

High prices destroy demand unevenly

Cargo prices in several regions passed \$1,000 a tonne in June, a record. Their subsequent decline does not signal that supply has recovered. Instead, buyers outside China have cut consumption because they cannot afford the material. Chinese demand has dropped for a different reason. The country previously imported sulphur, converted it into acid and re-exported it, accounting for more than 40% of traded volumes in 2025. A government ban on acid exports in May has virtually ended that business.

The impact depends on how much sulphur an industry needs and how easily it can pass on the cost. Chipmakers use very small quantities of sulphuric acid, so even a sharp increase in the input price barely changes their economics. Copper miners use much more acid to leach metal from ore, but elevated copper prices give producers in Chile and Africa room to absorb the expense.

Indonesian nickel miners are more exposed. Their production costs have risen while Chinese battery manufacturers, their main customers, have ample inventories and enough bargaining power to keep nickel prices low. Sulphur purchases in Indonesia are down by 75%, and miners have brought maintenance forward as they curtail activity.

Fertiliser bears the heaviest cost

Phosphate fertiliser producers face the most severe pressure because making ten tonnes of product requires roughly four tonnes of sulphur. Plants in America, Brazil, Egypt and Morocco initially slowed or stopped production. In May Mosaic, a large American fertiliser company, called the shortage the industry’s worst since 2008.

Producers have since preserved export volumes by using remaining stockpiles and shifting towards varieties that require less sulphur. The trade-off is that these products deliver fewer nutrients, while fertiliser prices have climbed. The immediate consequence is therefore not simply less output, but more expensive and potentially less effective farm inputs—a route through which a refinery disruption can eventually affect food production.

New capacity planned in China and India will not arrive soon enough to solve the present shortage. Alternatives to elemental sulphur require more energy and capital, so rapid substitution is unlikely. In the short term, meaningful relief depends on Gulf exports resuming, especially because that is where much of the world’s new supply was expected before the war.

The broader lesson is that industrial systems can hide important dependencies inside by-products. Sulphur looked abundant when refineries produced it automatically while making fuels. Once war interrupted those refineries and their shipping routes, users discovered that supply could not respond independently to demand. The Iran conflict has not merely made diesel scarcer; it has exposed how a bottleneck in energy can travel through metals, batteries, fertiliser and food, adding sulphur to the growing list of commodities that governments and companies must treat as strategic.