Iron phosphate negotiations in April were deadlocked, with offers hitting 13,000 yuan/mt. The price surge appeared raw-material driven, but in fact reflected pricing power shifting upstream after a reversal in supply-demand fundamentals. Downstream buyers cited “cost increases” to push back, yet conveniently forgot the upstream losses quietly absorbed over the past three years. This was never about simple cost pass-through—it was a restructuring of profit distribution across the chain.

[SMM Nickel Flash] March 31, the Russian government has extended the ban on exporting industrial sulfur until June 30, 2026, the government's press service reported. According to the signed decree, the restriction applies to the export of liquid, granulated, and lump sulfur. However, low-grade sulfur may be exported without restrictions, subject to confirmation from the Industry and Trade Ministry. The temporary restriction does not apply to shipments to Eurasian Economic Union member states, Abkhazia, and South Ossetia. Sulfur may also be exported for humanitarian aid, as part of international transit shipments, and to support the activities of Russian organizations on the Svalbard archipelago.

According to industry reports, the Pipestone XL project in Newfoundland, Canada, is advancing its awaruite (Ni₃Fe) nickel-cobalt deposit to supply the North American defense and energy storage sectors. Awaruite, a naturally occurring, sulfur-free magnetic alloy containing approximately 77% nickel, enables the production of a high-grade ~60% nickel concentrate through simple magnetic separation and flotation. This unique metallurgical profile completely bypasses carbon-intensive pyrometallurgical smelting and early hydrometallurgical stages like high-pressure acid leaching (HPAL).

Recently, China's manganese-based battery materials market has been characterized by cost-driven divergence and gradual demand recovery. Battery-grade manganese sulfate and trimanganese tetroxide have strengthened on the back of rising raw material and freight costs; electrolytic manganese dioxide remains stable; and lithium manganate is steady amid volatile lithium carbonate prices, awaiting a demand rebound in April.

Since the beginning of this year, the spot treatment charge market for copper concentrates has shown an unprecedented and severe downward trend. The SMM Copper Concentrate Spot Index has fallen from -45 USD/dmt at the start of the year to near -70 USD/dmt, with the speed and magnitude of the decline being historically rare. A negative treatment charge means that when smelters purchase copper concentrates, they not only fail to receive traditional processing income from miners but instead must pay the sellers. Based on the current TC of -70 USD/dmt, the actual cost smelters pay sellers in the copper smelting process is equivalent to a TC of 70 USD, or further converted to a TC+RC of approximately 112 USD. This extreme price signal has quickly drawn high market attention to smelter profitability and even sparked concerns about the sustainability of domestic copper smelting production. Despite treatment charges falling to historic lows, copper cathode production by Chinese smelters remains at high levels, currently around 1.2 million tons per month. This phenomenon of "producing more while losing more" appears, on the surface, to contradict market logic, but actually reflects smelters' passive choices and structural supporting factors in the current complex environment. Historically, extreme treatment charge scenarios are not unprecedented. In past industry downturns, smelters often relied on one or several factors—exchange rate fluctuations, rising sulfuric acid prices, or treatment charges themselves—to barely maintain cash flow balance. In the current cycle, the sharp rise in sulfuric acid prices has become a key variable supporting smelter survival. Currently, the ex-factory prices of smelter acid sold by domestic copper smelters generally range from 800 to 1,600 yuan per ton. The latest SMM Copper Smelting Acid Index stands at 1,235.5 yuan/ton. As a crucial byproduct of copper smelting, sulfuric acid price fluctuations significantly impact smelters' comprehensive earnings. Typically, smelters produce approximately one ton of sulfuric acid for every dry metric ton of copper concentrate processed. Based on the current sulfuric acid price of 1,235.5 yuan/ton, after deducting value-added tax (at a 13% rate) and converting to US dollars (using an exchange rate of 6.9), each ton of sulfuric acid can contribute about 158 USD in revenue for the smelter, equivalent to an additional 158 USD per dry metric ton of copper concentrate. If further converted to the TC+RC metric, this amounts to about 99 USD. Thus, the rise in sulfuric acid prices has significantly offset the loss pressure from negative copper concentrate treatment charges, with some more efficient smelters even achieving marginal profitability. It is precisely this "stabilizer" role of sulfuric acid that allows smelters to maintain high operating rates under extreme treatment charge conditions. However, the support of sulfuric acid for smelting profits is not unlimited, as its price trend is itself influenced by more complex international geopolitical factors. The recent sharp escalation of the Middle East situation has brought significant uncertainty to the global sulfuric acid and sulfur supply chain. Since the joint US-Israeli military strike against Iran on February 28, 2026, the Strait of Hormuz, the world's most critical energy transport route, has rapidly fallen into a severe transit crisis. After taking office, Iran's new Supreme Leader, Mojtaba Khamenei, immediately declared that the strait would remain closed as a strategic lever against the US-Israeli alliance and suggested that neighboring countries close US military bases. The Islamic Revolutionary Guard Corps subsequently explicitly announced a ban on any vessels associated with the US or Israel from passing through the Strait of Hormuz, warning of severe consequences for unauthorized passage. The Strait of Hormuz is a critical chokepoint for global sulfur transport. Statistics show that before the conflict, over 100 ships passed through the strait daily. However, after the conflict erupted, transit traffic plummeted by over 90%, with extreme cases of no ships passing for an entire day, leaving over 3,000 vessels stranded in nearby waters. This effective blockade has not only directly impacted the crude oil market—with Brent crude futures rising over 50% within a month to exceed 114 USD per barrel—but has also severely disrupted the global supply chain for sulfur and sulfuric acid. War risks have caused shipping insurance costs to soar to over 20% of the cargo value, further increasing logistics costs and plunging global sulfur supply into a logistical crisis. Although Iran claims to allow passage for vessels from "non-hostile" countries, requiring them to obtain prior permission, actual transit volumes remain extremely low, far below global trade demand. Simultaneously, the Houthi armed group in Yemen has announced its involvement, posing new security threats to the Red Sea-Suez route. The compounding pressure on the two major shipping chokepoints of the Strait of Hormuz and the Red Sea is posing a systemic challenge to the global supply chains for energy and chemical raw materials. As the primary raw material for sulfuric acid production, the disruption in sulfur supply directly drives international and domestic sulfuric acid prices progressively higher. Given the current situation, geopolitical conflicts show no signs of easing in the short term, implying further room for sulfuric acid price increases. The continued rise in sulfuric acid prices will have a dual impact on the domestic copper smelting industry. On the one hand, increased sulfuric acid revenue will continue to provide crucial profit supplementation for smelters, enabling them to maintain production even at lower TC levels and potentially further depressing spot copper concentrate treatment charges. On the other hand, this surge in sulfuric acid prices, driven by geopolitical conflict, also makes smelter profitability highly dependent on external unstable factors, rendering the industry's overall risk resilience increasingly fragile. Notably, the extreme treatment charge environment has begun to have a tangible impact on the global layout of copper smelting capacity. Mitsubishi Materials of Japan recently announced its plan to cease operations at its Onahama copper smelter by the end of March 2027. The smelter has a crude and refined capacity of 230,000 tons, and the main reason for the closure is precisely the intensified competition in the global copper smelting industry, leading to a sharp deterioration in copper concentrate TC/RC and persistent pressure on business prospects. This decision sends a clear signal: against the backdrop of continuously bottoming treatment charges and industry profits highly dependent on byproducts and external environments, some high-cost smelting capacity or those lacking comprehensive recovery capabilities are facing pressure to exit the market. In summary, China's copper smelting industry is currently at a highly unusual cyclical juncture. On one hand, smelters, benefiting from high sulfuric acid prices, have temporarily weathered the impact of negative treatment charges, maintaining high output. On the other hand, sulfuric acid prices themselves are heavily dependent on geopolitical situations, and external variables like the Strait of Hormuz blockade introduce significant uncertainty into the sustainability of smelting profits. If tensions in the Middle East persist, sulfuric acid prices may continue to rise, leaving room for TC to fall further, potentially enhancing smelters' tolerance for extreme treatment charges in phases. However, if geopolitical tensions ease, sulfur supply chains recover, and sulfuric acid prices retreat from their highs, smelters would face the risk of a "double blow" from both low treatment charges and reduced byproduct revenue, potentially heralding a genuine phase of capacity reduction and deep adjustment for the industry. Therefore, the current apparent "resilience" of the copper smelting industry is essentially built upon a fragile balance between geopolitical factors and the byproduct market. For market participants, besides monitoring TC trends, it is crucial to closely track changes in sulfuric acid prices and the underlying geopolitical factors to make more accurate judgments regarding the production sustainability and profitability prospects of the smelting industry.

Recently, the team led by Meng Qingbo at the Institute of Physics, Chinese Academy of Sciences, once again set a new record in new-type thin-film PV copper-zinc-tin-sulfur-selenium (CZTSSe) technology, raising the battery’s certified efficiency to 16.6%, marking the technology’s official crossing of the critical threshold for industrialisation from 15 to 16. Composed of common, low-cost elements such as copper, zinc, and tin, CZTSSe materials not only avoid reliance on rare metals but also offer strong resistance to space radiation. At present, the team has also completed the development of high performance flexible batteries and modules, and this technology is expected to achieve large-scale application in fields such as low-Earth-orbit satellite internet, space-based energy bases, and aerospace equipment in the future. This progress not only established China’s internationally leading position in this field, but also opened up strategic, high-value-added application prospects for tin metal in new energy and deep-space exploration.

Disruptions to shipping routes and the Strait of Hormuz are tightening sulfuric acid supplies. The Middle East accounts for about 24% of global sulfur output, with nearly 40% of seaborne sulfur passing through Hormuz. Chile’s main suppliers—China, Peru and South Korea—are affected, pushing spot prices up nearly 20% since early 2026. Chile is advancing domestic smelter projects to reduce import reliance and secure supply.

Faced with a severe energy supply crunch and skyrocketing prices triggered by the Middle East conflict, the Philippine Department of Energy has authorized the temporary use of "dirtier" Euro-II petroleum products, which contain ten times more sulfur than the current Euro-IV standard, specifically for older vehicles, industrial plants, and the shipping sector. This emergency measure follows diesel prices breaching 100 pesos per liter for the first time, a crisis exacerbated by the country's limited refining capacity and the 1998 Oil Deregulation Law. As the region grapples with the obstruction of the Strait of Hormuz, the Philippines joins neighbors like Vietnam and Thailand in pivoting back to high-emission fuels and coal to ensure domestic energy security amidst the global turmoil.

SMM Nickel News, March 24: Macro and Market News: (1) Iran’s Parliament Speaker Qalibaf denied having held talks with the US side and accused fake news of manipulating the financial and oil markets; Iran’s Islamic Revolutionary Guard Corps said it would launch new attacks on US targets and called Trump’s remarks “psychological warfare” (2) Israeli officials said Washington had set April 9 as the target date for ending the war. Talks between Iran and the US were expected to be held later this week in Pakistan, adding that Washington had not yet informed Israel of any contact with Iran’s Parliament Speaker Qalibaf. Spot Market: On March 24, the SMM price of #1 refined nickel fell 1,700 yuan/mt from the previous trading day. In spot premiums, Jinchuan #1 refined nickel averaged 6,250 yuan/mt, down 300 yuan/mt from the previous trading day; China’s mainstream brands of electrodeposited nickel were at -300-400 yuan/mt. Futures Market: After surging sharply in the night session, the most-traded SHFE nickel 2605 contract pulled back in the morning session, closing the morning session at 132,830 yuan/mt, up 0.69%. Current nickel prices were in a stage of intense tug-of-war between macro headwinds and supply risks. Short term, tighter Indonesian RKAB quotas, continued gains in ore prices, and the risk of sulfur supply disruptions provided solid support below, but high inventory and the slow recovery in end-use demand still capped upside room. The core trading range of the most-traded SHFE nickel contract was expected at 130,000-140,000 yuan/mt in the short term.

According to the latest data disclosed by the General Administration of Customs, China’s imported copper cathode market, while maintaining the 2025 baseline, is facing dual challenges: the continued rise in the share of EQ copper and whether global supply will continue to be diverted. China’s cumulative copper cathode imports in January-February 2026 totaled 356,900 mt, down 33.13% YoY.