By Penny Langford
The global copper market is confronting a structural supply constraint that few analysts prioritized eighteen months ago: a critical shortage of sulfuric acid. While the industry has long focused on declining ore grades and the slow pace of new mine approvals, the availability of this essential chemical reagent has now become a primary determinant of refined production capacity.
As of July 2026, disruptions in the Strait of Hormuz, coupled with export bans from major producers like China and Russia, have significantly tightened the seaborne sulfuric acid market. This shortage is disproportionately impacting copper solvent extraction and electrowinning (SX-EW) operations: processes that account for roughly 20% of global primary copper supply. With sulfuric acid prices surging over 150% in key importing regions, the operational economics of major mines in Chile, the Democratic Republic of the Congo (DRC), and the southwestern United States are under severe pressure.
The Strait of Hormuz and the Global Sulfur Trade
The current crisis traces back to February 2026, when escalating geopolitical tensions effectively halted maritime traffic through the Strait of Hormuz. This corridor is the primary exit point for sulfur produced by Middle Eastern oil and gas refineries. Gulf states historically account for approximately 44% of global seaborne sulfur trade.
Sulfur is the essential feedstock for sulfuric acid production. The partial closure of the Strait removed an estimated 4 million tonnes of annual sulfur flow from the market. For the African Copperbelt, where the DRC and Zambia rely on the Middle East for over 90% of their sulfur imports, the impact was immediate. Vessels carrying hundreds of thousands of tonnes of sulfur remain diverted or stalled, leading to dwindling on-site inventories at some of the world's largest copper-cobalt projects.
Compounding this maritime disruption, China: traditionally a major exporter of sulfuric acid to South American copper producers: implemented a strict export ban in May 2026. This move was designed to prioritize domestic industrial use and agricultural fertilizer production, but it stripped another 3 million tonnes of supply from the global market. The IEA's recent mineral risk report had warned that midstream bottlenecks would become immediate economic threats, a forecast that has now materialized with precision.
Why Leaching Operations are "Hostage" to the Acid Market
Copper production generally follows two paths: smelting (treating concentrates) and leaching (treating oxide ores). The leaching process, or SX-EW, is entirely dependent on a steady supply of sulfuric acid to dissolve copper from the rock on heap leach pads.
Unlike smelters, which produce sulfuric acid as a byproduct of processing sulfide ores, leaching-only operations must purchase acid on the merchant market. In Chile, the world's top copper producer, nearly half of its refined output comes from leaching. When Chinese exports to Chile dropped to zero in March 2026, mining operators in the Atacama region were forced to scramble for alternative supplies from high-cost producers in Europe or North America.
| Institution | 2026 Copper Market Balance (Refined Tonnes) |
|---|---|
| ICSG | 150,000 Tonne Deficit |
| J.P. Morgan | 330,000 Tonne Deficit |
| UBS | 407,000 Tonne Deficit |
| Morgan Stanley | 600,000 Tonne Deficit |
| Goldman Sachs | 160,000 Tonne Surplus |
Source: Compiled Market Intelligence 2026.
As shown in the data above, the consensus has shifted decisively toward a structural deficit. The sulfuric acid shortage is the "binding constraint" that is making these deficits more likely. If current acid prices persist through Q4 2026, industry analysts suggest that 100,000 to 200,000 tonnes of refined copper production could be lost due to curtailed leaching cycles or delayed ramp-ups of new projects.
Copper Price Forecast 2026: Base, Bull, and Bear Scenarios
The copper price forecast 2026 is increasingly bifurcated based on how analysts weigh the acid crisis.
The Base Case: $12,000 – $12,500/t
The majority of financial institutions, including J.P. Morgan and S&P Global, expect copper to average just above $12,000 per tonne for the full year. This case assumes that sulfur shipments from the Persian Gulf will begin to normalize by late Q3 2026, providing relief to African and South American operators. However, the existing deficit, exacerbated by earlier mine closures like Cobre Panama, remains the underlying floor for prices.
The Bull Case: $14,000 – $15,000/t
In a scenario where the Strait of Hormuz remains contested and China extends its export ban into 2027, copper prices could see aggressive upside spikes. Citigroup and UBS have outlined scenarios where a sustained 600,000-tonne deficit pushes prices toward $14,500/t. In this environment, the "wet-process" copper output is significantly impaired, forcing buyers to compete for limited inventories of Grade A cathode.
The Bear Case: $10,000/t
The conservative view, maintained by Goldman Sachs, suggests that a small surplus is still possible if demand from China’s property sector weakens further and new mine supply in Peru and the DRC offsets the acid-related losses. In this view, sulfuric acid is a temporary logistical hurdle rather than a structural market shift.
Regional Exposure and Vulnerable Projects
The copper deficit impact 2026 is not being felt equally. Integrated miners with their own captive smelters: such as Freeport-McMoRan in Arizona or Glencore in the DRC: possess a natural hedge. They capture the sulfur dioxide from their smelting operations and convert it directly into the sulfuric acid needed for their leaching pads.
In contrast, non-integrated players and pure-play leaching operations are highly exposed. In Chile, Codelco and several mid-tier producers are navigating a 37% import gap left by the absence of Chinese supply. In the DRC, projects that rely on trucking sulfur thousands of kilometers from East African ports are seeing their "all-in sustaining costs" (AISC) balloon.
The IEA has warned of a $6.5 trillion risk if critical mineral supply chains do not diversify. The sulfuric acid crisis is a case study in that risk. When a localized maritime disruption in the Middle East can halt copper production in the Andes or the African interior, the fragility of the energy transition’s "backbone" becomes undeniable.
Strategic Shifts in Mining Operations
To mitigate the current crisis, many mining companies are accelerating investments in on-site sulfur burning plants or exploring new leaching technologies that require lower acid concentrations. However, these solutions have multi-year lead times.
In the immediate term, operations are focusing on "efficiency leaching," optimizing the chemical balance to squeeze more copper out of each tonne of acid. Control rooms are now using advanced telemetry to monitor acid consumption in real-time, as seen in modern facilities across the Copperbelt.
For mining news followers and investors, the key watchpoints for the remainder of 2026 will be:
- Normalization of Persian Gulf Shipping: If sulfur flows do not recover by September, the DRC production curtailments will likely become official.
- China’s Trade Policy: Any signal that Beijing will lift the sulfuric acid export ban before December would provide immediate downward pressure on acid prices.
- LME Inventory Levels: Copper stocks are already at historically low levels; further drawdowns will signal that the acid shortage is translating into a physical metal squeeze.
Conclusion
The sulfuric acid shortage has transformed from a niche logistical issue into a central pillar of the copper price forecast 2026. As long as the primary reagents for copper production remain entangled in geopolitical disputes, the market will likely remain in a high-volatility, high-price regime. For the mining industry, the lesson of 2026 is clear: the energy transition depends not just on the minerals in the ground, but on the chemicals required to extract them.
For daily updates on commodity markets and operational risks, refer to the latest Skillings Mining Intelligence report.
Shareable Snippet for LinkedIn/X
? Market Alert: The "Invisible" Copper Bottleneck ?
Sulfuric acid shortages are now a primary driver for the Copper Price Forecast 2026. With the Strait of Hormuz disrupted and China banning exports, nearly 20% of global copper supply is at risk.Is the industry prepared for a structural deficit? Read our deep dive into how chemical scarcity is reshaping the market. #Copper #MiningNews #EnergyTransition #SulfuricAcid #CopperPrice2026
