Study authors warn that sulphur supply is severely at risk, with potential global economic repercussions. EU countries are mainly affected due to indirect dependencies, particularly via China.
THE STUDY IN A NUTSHELL
- The EU faces limited supply risks for elemental sulphur and sulphuric acid due to Gulf-linked disruptions.
- Imports of downstream sulphuric acid products to the EU, valued at USD 49 billion, are potentially affected, with 9.4% originating from China—the largest importer of unrefined elemental sulphur from the Gulf region.
- Austria would be affected mainly indirectly: Prolonged disruptions could raise prices and strain industrial production.
- Strategic precautions are crucial: companies should urgently review their supply chains for potential dependencies, the study authors say.
The renewed blockade of the Strait of Hormuz is putting further pressure on the global economy: alongside the supply of oil and gas itself, the supply of sulphur – a byproduct of crude oil refining – is also severely at risk, with potentially worldwide economic consequences, including for the European Union and Austria. Sulphur is indispensable to global industry. The raw material is processed primarily into sulphuric acid – a key chemical for fertilizers, batteries, dyes, pesticides, metal processing, and numerous industrial production processes.
A new study by researchers from the Complexity Science Hub (CSH) and the Supply Chain Intelligence Institute Austria (ASCII) warns of a potential “systemic sulphur shock” for European industry as a result of a prolonged blockade of the Strait of Hormuz. While Europe and Austria are only directly dependent on sulphur imports from the Gulf region to a limited extent, a far greater risk arises through global supply networks.
“The greatest danger lies not in direct sulphur imports, but in the indirect dependencies along global supply chains. As long as the crisis remains short-term, companies can partially cushion shortfalls through inventory or alternative suppliers. However, if the disruption continues for several months, systemic effects on industrial production, chemicals, agriculture, and numerous other sectors become increasingly likely. Companies should therefore urgently review their supply chains for potential dependencies and develop contingency measures,” says study author Peter Klimek, CSH faculty member and ASCII director.
Nearly Half of Global Sulphur Exports Originate from the Gulf Region
According to the study, around 47 percent of global sulphur exports come from countries around the Arabian Gulf, including the United Arab Emirates (17%), Qatar (14%), and Saudi Arabia (8%). The EU imports sulphuric-acid-dependent products worth approximately US$49 billion annually – primarily aluminum, copper, organic chemicals, as well as pesticides and herbicides. The study shows that Europe’s direct dependence on sulphur imports from the Gulf region is currently comparatively low. The EU sources unrefined sulphur mainly from the United Kingdom (23% of imports), Kazakhstan (18%), and Serbia and Turkey (approximately 12% each), while around 26 percent of demand is met by domestic production. The EU is also largely self-sufficient in sulphuric acid, covering about 87 percent of its needs domestically; the most important import partners are Taiwan (42%), the United Kingdom (19%), and Norway (16%).
Indirect Dependencies — Especially via China — Pose the Real Risk
According to the study, however, the indirect dependencies via international supply chains are considerably more critical: many countries from which Europe imports important industrial products are themselves heavily reliant on sulphur from the Gulf region. While the EU directly imported only about US$3 million worth of sulphur and sulphuric acid from Gulf states in 2023, Europe’s actual exposure via international supply chains is roughly three times as high. According to ASCII, the indirect dependencies via China are especially critical. The country imports 54 percent of its sulphur from the Gulf region and, in turn, exports sulphuric-acid-dependent products worth US$4.6 billion to the EU. This corresponds to 9.4 percent of EU imports in these product categories. In several industrial sectors, Europe’s import dependence on China is particularly high: 43 percent of EU imports of paper and pulp come from China, along with 26 percent of dyes and pigments and 25 percent of pesticides and herbicides.
“In a prolonged crisis, China becomes a central amplifier of global supply-chain risks. Many companies can still cushion short-term shortfalls through inventories or alternative suppliers – but reserves often last only one to two months,” says Stefan Thurner, President of the Complexity Science Hub.
China's Sulphuric Acid Export Ban Becomes a Risk Factor
Additional risks arise from China’s export ban on sulphuric acid, in effect since early May 2026. In June, Chinese sulphuric acid exports fell by 99 percent compared to the previous month. This is putting further pressure on global supply chains – particularly via third countries such as India, Morocco, Chile, Malaysia, Vietnam, and Indonesia. In total, the study identifies additional indirect risks for the EU amounting to roughly US$1.4 billion. India is considered especially critical: around 72 percent of Indian sulphur imports originate from the Gulf region. At the same time, the EU imports sulphuric-acid-dependent products worth approximately US$2.9 billion from India.
Indirect Supply-Chain Risks Could Affect Austrian Industry
Austria, too, is affected by global sulphur dependencies mainly indirectly. According to the study, Austria imports sulphuric-acid-dependent products worth around US$930 million annually, of which about US$85 million is attributable to China. While the analysis shows no particularly high risk for Austria, longer-term disruptions along global supply chains could have significant effects on industrial production processes, raw material prices, and key intermediate inputs in Austria. Industries with high dependence on chemicals, metals, and inputs from international value chains would be particularly affected.
“Even if industry does not immediately face acute supply shortages, these risks lead to cost surcharges. This puts further pressure on Austrian, German, and European producers and intensifies competition for distribution among industries,” explains Peter Klimek.
Strategic Preparedness Is Crucial
Should the Hormuz blockade persist, global production bottlenecks, rising prices, and systemic disruptions along numerous value chains are likely. Even after a potential reopening of the Strait of Hormuz, rising insurance and transport costs could increase sulphur prices by 10 to 40 percent, according to the study. The study’s authors therefore recommend that companies and policymakers quickly identify critical sulphur dependencies along their supply chains and examine strategic precautionary measures. These include greater diversification of supply chains as well as systematic monitoring of China and India as key early-warning indicators.
About the study
The study “EU Sulphur Supply Exposure: Risk from Strait of Hormuz Closure Aggravated by Indirect Dependencies through China and India” by Sophia Baum, Stefan Thurner, and Peter Klimek analyzes global sulphur and sulphuric acid supply chains as well as indirect dependencies along international value creation networks. The study is based on international trade databases such as BACI and Eurostat/COMEXT & PRODCOM.
This article is based on a press release originally published by the Austrian Supply Chain Intelligence Institute (ASCII).
