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Wire rod producers across the Gulf Cooperation Council (Gulf Co-operation Council) were already feeling the squeeze, with order books unchanged in size but increasingly difficult to fill as cathode supply dried up, sources told Fastmarkets. The disruption has also raised questions about the fate of Iranian refined copper exports and threatened to ripple into African cathode production through sulfur supply chains.
A trader in the region described the mood on the ground as tense but measured, with explosions audible in the distance most nights — particularly between 9pm and 3am local time — and residents in neighboring Dubai watching missile interceptions from their balconies.
Abu Dhabi airspace remained closed at the time of the interview, sources said, with commercial flights suspended.
But the copper market effect was already tangible. Shipping lines including MSC, Maersk, CMA CGM, Cosco, Hapag-Lloyd and Ocean Network Express have suspended bookings or halted Hormuz transits since Monday, with insurers refusing to cover vessels transiting the strait.
“Insurers aren’t insuring shipping lines going into the Gulf,” the trader said.
Khor Fakkan and Fujairah, the UAE’s two main ports on the Indian Ocean side, outside the strait, remained operational but were struggling to absorb the surge in diverted cargo.
“Most [producers] in the GCC truck wire rod to customers — [they] don’t have to ship wire rod out. [Their] order books [are] still the same size but [they] can’t get enough cathode to produce material to fill [them],” the trader said. “Bringing that quantity [of cathode through alternative ports] is not an easy ask in the quantities required.”
The supply squeeze carried an ironic edge: anyone holding copper cathode inside the UAE suddenly found themselves with unusual pricing power but no way to replenish stock.
The disruption followed a wave of booking suspensions and Hormuz transit halts by the world’s largest container carriers from March 2 onward.
Hapag-Lloyd, in a customer notice dated Tuesday March 3, cited “the official closure of the Strait of Hormuz by relevant authorities” as the basis for its suspension of all vessel transits through the waterway. The shipping line also applied a War Risk Surcharge of $1,500 per twenty-foot equivalent unit (TEU) to bookings issued on or after March 2, as well as to cargo already on the water but not yet discharged.
MSC suspended all bookings for worldwide cargo to the Middle East region until further notice on Sunday March 1. Maersk suspended acceptance of refrigerated and dangerous special cargoes in and out of the UAE, Oman, Iraq, Kuwait, Qatar, Bahrain and Saudi Arabia and halted new bookings between the Indian subcontinent and several Gulf destinations.
Roughly 750 ships were backed up around the Strait of Hormuz as of early March, with approximately 10% of the global container ship fleet caught up in the disruption, according to media reports.
The closure also threatened to disrupt Iranian refined copper exports, which totaled approximately 114,000 tonnes in 2024, according to International Copper Study Group (ICSG) data published in February 2026. Iran’s total refined copper production reached approximately 312,000 tonnes in 2024, with domestic consumption of around 167,000 tonnes, leaving a significant surplus for export.
Furthermore, the data showed Iran’s refined copper production at approximately 305,000 tonnes in the first 11 months of 2025, putting the country on track for around 330,000–335,000 tonnes for the full year, up approximately 6–7% year on year.
A significant portion of Iran’s refined copper production is also processed domestically into wire rod and exported as semi-finished product, sources told Fastmarkets.
The bulk of Iranian copper exports are shipped via Bandar Abbas, Iran’s most strategically important port, located directly on the Strait of Hormuz. Satellite imagery reviewed by multiple media outlets since March 2 has shown extensive damage to naval facilities at Bandar Abbas following US and Israeli strikes, with commercial port operations reported as suspended.
The destination of Iranian cathode exports remained difficult to confirm precisely. “Pretty much all of it goes to China, is my understanding,” a US-based trader told Fastmarkets on March 3. Sources have said cathode was also being exported to India and that Turkey had historically been a destination, though buyers there were reluctant to acknowledge taking the material given the sanctions risk.
“I’ve certainly heard material was going into Turkey — the question is how much they’re taking and whether [it is being] rebranded,” the trader told Fastmarkets.
Another risk flagged by market participants was the potential disruption to sulfur shipments from Middle Eastern producers — including Abu Dhabi National Oil Company (ADNOC), one of the world’s largest producers of granulated sulfur — to African copper operations.
Sulfur is a key feedstock for sulfuric acid used in solvent extraction-electrowinning (SX-EW) copper cathode production. A sustained disruption to Middle Eastern sulfur supply could constrain SX-EW output at major African operations.
“Will it be significant [enough to] affect price and [the] market? Probably not, but [it] will be [causing a] disruption for a month or two,” the trader said. “[Producers will] need to find new sources of sulfur outside [the] Middle East.”
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Despite the disruption, several market participants cautioned against overstating the immediate effect on London Metal Exchange copper prices.
Marex analyst Ed Meir told Fastmarkets on Monday that copper’s exposure to the Gulf disruption was more limited than for other commodities.
“I know [Iran has] significant reserves and produce quite a bit of metal,” Meir said. “Unlike oil and aluminium, copper is not as supply-stressed in terms of Gulf shipments, even if you take out Iranian production. Right now it’s a moot point about price impact — nothing is going in and out of the Gulf anyway.”
The trader echoed this view, saying he did not think the volumes involved were “significant enough to move the dial on the copper price.”
But the trader cautioned that the duration of the conflict would be the determining factor. “If [the] war only lasts a few weeks, then everything opens up again — you can get stuff to Jebel Ali, then fine. But if the war goes on for six, eight, twelve weeks — or a year — it becomes an issue.”
The London Metal Exchange copper cash price was $12,959 per tonne on Wednesday March 4, down from $13,229.50 per tonne on March 2 — the day the strait was declared closed.
Other US market participants urged caution in drawing conclusions too early.
“I think at this point there is too much uncertainty about the entire situation, so I would hesitate to even guess about the implications. Let’s give it a week and see what happens,” John Gross, consultant and publisher of The Copper Journal, told Fastmarkets on Tuesday.
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