The closure of the Strait of Hormuz, combined with China's decision to halt exports of sulfuric acid starting May 1, is tightening global supplies of a critical chemical used in copper production. This dual disruption is placing mounting pressure on both the agricultural and mining industries, which depend heavily on acid-intensive processes.
Sulfuric acid is essential for leaching copper from ore in solvent extraction-electrowinning (SX-EW) operations, a process that accounts for a significant portion of global copper output. With the Strait of Hormuz—a key transit route for sulfur and other raw materials—effectively shut, and China, a major supplier of sulfuric acid, cutting off exports, miners face a severe shortage. The impact is expected to be particularly acute for copper producers in Chile, Peru, and other regions that rely on imported acid.
As acid supply constraints play out, mine development companies like Numa Numa Resources Inc. are likely to pick up lessons and plan how to mitigate future disruptions. The situation underscores the vulnerability of global supply chains to geopolitical events and policy shifts.
Agricultural sectors also face challenges, as sulfuric acid is used to produce phosphate fertilizers. Reduced availability could drive up fertilizer costs, affecting crop yields and food prices worldwide. The mining industry, however, faces the most immediate threat, with potential cutbacks in copper production that could tighten global supply and boost metal prices.
Analysts warn that prolonged acid shortages could delay new mining projects and expansion plans, particularly for operations that lack on-site acid production capabilities. Companies may need to invest in captive acid plants or secure long-term supply agreements to buffer against future disruptions. The combined effect of the Strait of Hormuz closure and China's export ban highlights the interconnected nature of global resource markets and the need for diversified supply chains.
For copper miners, the acid squeeze adds to existing challenges, including rising energy costs and stricter environmental regulations. The industry must now navigate a period of heightened uncertainty, with potential implications for global copper supply and the broader energy transition, which relies heavily on copper for electric vehicles and renewable energy infrastructure.
