Commodity Market Pressures Amid Iran Conflict

March 2026, Almonti tungsten mine in Sangdong, South Korea.

BEIJING — The ongoing war in Iran is putting pressure on global commodity markets that are already feeling the effects of China’s export restrictions and stockpiling strategies.

Recently, prices for three niche elements—tungsten, sulfur, and helium—have escalated significantly. Even though these commodities don’t trade as extensively as oil, the price increases illustrate how the Middle East conflict might hinder semiconductor production, which is crucial for developments in artificial intelligence.

Tungsten, noted for its hardness comparable to diamond, plays a vital role in semiconductor manufacturing. Similarly, sulfur is essential for producing sulfuric acid, while helium is key in preventing unwanted chemical reactions during semiconductor production.

Tensions with the United States have prompted the Chinese government to tighten control over critical supplies, a trend that began even before the Iran war started on February 28. China initiated export restrictions on tungsten about a year ago and has plans to further limit sulfuric acid exports. Meanwhile, helium imports have surged—up nearly 15.7% in 2025 following a previous rise of about 65% in 2024.

The Iran war and restrictions related to the Strait of Hormuz, a vital transport route for energy and chemicals, have shifted some oversupply situations into shortages while worsening existing deficits.

Prices for these commodities have skyrocketed, with some even exceeding crude oil prices. Oil itself saw a rise of more than 50% in March, with Brent crude on track for a record month.

“China’s supply chain is often viewed as more resilient than many others,” analysts at Goldman Sachs noted in a recent report, highlighting the heightened risk of disruptions for chemical raw materials.

Tungsten

Tungsten reached a record high of over $3,000 last week, representing a month-on-month increase of more than 50% and a tripling of prices since late December. This benchmark is based on a standard known as “ammonium paratungstate (APT).” Earlier this month, Almonti restarted operations at its tungsten mine in Sangdong, South Korea, and plans to initiate tungsten production in Montana this year.

Almonti’s CEO, Lewis Black, remarked that while defense-related demand for tungsten has remained strong since early last year, the Iran war hasn’t noticeably changed this trend. “We don’t have materials to stockpile anymore, which is likely the biggest shift,” he commented.

Sulfur

Goldman Sachs analysts, sourcing information from local Chinese miners in Africa, reported that sulfuric acid prices there have increased by at least 30% since the onset of the war. However, some reviews indicate that these price hikes have been gradual.

In China, sulfur prices, including shipping costs, have risen roughly 13% since early March, reaching about $621 per ton as of March 26. Analysts predict that a de facto blockade lasting two to three months could lead to a severe supply shock, especially considering high cargo and insurance premiums that complicate shipments from the Middle East.

By 2025, approximately 56% of China’s sulfur imports are expected to originate from the Middle East, which was already a source of rising prices before the conflict began. Analysts from HSBC pointed out that the current surge in sulfur prices signifies a “super squeeze” on this otherwise lesser-known commodity.

Helium

According to Fitch Ratings, helium prices have almost doubled since the war began. Shelley Jiang, the director of corporate ratings for Fitch in the Asia-Pacific region, noted that pinpointing broad industry prices is complicated due to long-term contracts between industrial gas suppliers and manufacturers.

Recent events, like an Iranian missile attack affecting Qatar’s primary helium-producing center, which supplies roughly one-third of the world’s helium, suggest that recovery in helium supplies would be slow. In China’s Henan province, helium prices have increased from a low of 545 yuan to 600 yuan per bottle since the conflict started.

This shortage attributed to the Iran war is just the latest disruption in supply chains that have already been affected by events like Russia’s invasion of Ukraine and the coronavirus pandemic. As a result, companies are looking to diversify their sources, and countries like China are intensifying their stockpiling measures.

The Rhodium Group reported that discussions around securing supplies of specific physical materials concentrated in China will likely dominate deals with Beijing. Additionally, the lack of price transparency may indicate that shortages could be more severe than currently evident.

Ecclestone pointed out that while tungsten and helium prices rise, it doesn’t seem that there’s panic among consumers. Defense contractors are expected to have tungsten stockpiled, but that’s evidently not the case. “The world has grown complacent, thinking of supplies as always readily available, much like items in a supermarket,” he noted, emphasizing the gaps that have emerged in this once-accepted phenomenon.