China fast-tracks sulphur futures as prices surge over 210%

China is pushing to launch its first sulphur futures contracts in the fourth quarter of 2026, as the war in Iran and resulting Strait of Hormuz disruptions have sent domestic sulphur prices to record highs and slashed the country's imports of the commodity.

Dalian Exchange Eyes Q4 Debut

The Dalian Commodity Exchange is likely to introduce sulphur futures before year-end, although the timeline has not been finalized and still requires approval from the China Securities Regulatory Commission, according to Reuters, citing people familiar with the matter. Neither the exchange nor the regulator responded to requests for comment.timesofindia.indiatimes+1

The move is designed to give Chinese industry a domestic hedging mechanism against volatile sulphur prices, which have surged more than 210% year-to-date, reaching 11,600 yuan per tonne as of mid-June. Benchmark prices hit 7,633 yuan per tonne in May, representing a nearly sixfold increase from lows in late 2024.achilleschem+2

Supply Crunch Drives Urgency

The conflict in the Gulf region has effectively halted sulphur shipments through the Strait of Hormuz, a chokepoint that handles nearly 50% of global seaborne sulphur trade. The region's oil and gas refining — which produces sulphur as a byproduct — has been severely disrupted.weforum+2

China, the world's largest sulphur importer with annual imports of roughly 9.6 million tonnes in recent years, has seen inflows collapse. From January to April 2026, cumulative imports totaled just 1.85 million tonnes, down 48% from the same period a year earlier. April imports fell to 295,500 tonnes, a 72% year-on-year decline and the second-lowest monthly figure on record. First-quarter imports hit a five-year low at 1.55 million tonnes, down nearly 38% year-on-year.oilchem+3

Broader Market Implications

China also suspended sulphuric acid exports starting May 1, redirecting domestic supplies inward as raw material shortages worsened abroad. The export ban has contributed to rising international sulphuric acid prices while stabilizing some domestic supply chains for fertilizers and chemicals.echemi+2

The planned futures contract would give China greater pricing power in the global sulphur market. As the Financial Times reported in March, the virtual halt in Strait of Hormuz shipping has choked off supplies of the commodity that underpins fertilizer production, rubber processing, and chemical manufacturing worldwide.ft