Full Breakdown
Fertiliser Supply Shock from the Iran War Threatens Global Food Security
5/2/2026, 6:03:05 AM
The War’s Immediate Impact on Fertiliser Trade
The United States and Israel’s strike on Iran on 28 February 2026 prompted Iran to close the Strait of Hormuz, a narrow waterway through which roughly one-third of the world’s seaborne fertiliser normally passes. The closure halted shipments of urea, ammonia and other nitrogen-based inputs from Gulf producers, immediately curtailing global supply.
Energy Prices as a Direct Driver of Fertiliser Costs
Natural-gas prices, which serve as the primary feedstock for nitrogen fertilisers, surged after the conflict. The World Bank links the rise in fertiliser production costs to the spike in natural-gas prices, noting that “fertilisers are energy, so when energy costs rise, automatically fertiliser costs rise.”
Scale of the Disruption (Data & Statistics)
- Approximately 30 % of global seaborne fertiliser originates from the Persian Gulf (Vespucci Maritime).
- Urea prices rose more than 40 % within weeks of the war; some sources report an 80 % increase.
- Yara International estimates that half a million tonnes of nitrogen fertiliser are currently offline, translating to a loss of up to 10 billion meals per week.
- The FAO warns that reduced input use could push 45 million additional people into acute hunger in 2026.
- The Food Price Index has begun to climb, and the UN World Food Programme projects a 24 % rise in food insecurity across Asia-Pacific.
- The Food and Drink Federation forecasts UK food-price inflation of 10 % by December.
- Modelling by IFPRI suggests that reduced fertiliser application this season could lower global grain stocks in the next harvest.
Official Responses from Governments and International Bodies
European agriculture ministers have called for coordinated action to safeguard fertiliser supplies and mitigate high energy costs. The World Bank’s report urges EU institutions to reinforce aid to farmers while preserving competitiveness among EU fertiliser producers. The FAO highlights the “fertiliser squeeze” as a primary driver of rising food prices, especially in India, Bangladesh, Egypt, Sudan and Sub-Saharan Africa. The International Food Policy Research Institute warns that lower fertiliser use during critical planting windows will likely depress next-year grain yields worldwide.
Criticism and Market Behaviour
DeSmog’s analysis reveals that senior executives at major fertiliser and grain firms sold shares worth more than $66 million during the price surge, prompting accusations of profiteering from the crisis. Food-security advocates argue that such insider sales, combined with the concentration of grain trade among a few firms, exacerbate vulnerability for low-income consumers.
Conflicting Figures and Gaps
Sources differ on the exact share of fertiliser trade affected: some cite 30 % of seaborne fertiliser, while others reference “roughly one-third.” Reported price increases range from 45 % to 80 % for urea. The World Bank quantifies the potential loss of 10 billion meals per week, whereas other analyses provide only qualitative assessments of “significant drops” in yields.
Verbatim Quotes
- “Europe is not facing a supply issue for the current season given the relatively high output of European production which historically satisfies around 70% of European demand as well as record high import levels in Q4 2025,” — Spokesperson, Fertilisers Europe.
- “We're up to half a million tons of nitrogen fertiliser not being produced in the world right now because of the situation we are in,” — Svein Tore Holsether, CEO, Yara International.
- “Fertilizer is the most important element. Thirty percent of the world’s seaborne fertilizer comes from the Persian Gulf,” — Lars Jensen, CEO, Vespucci Maritime.
- “The most important thing we can do now is raise the alarm on what we are seeing right now – that there is a risk of a global auction on fertiliser that means it becomes unaffordable for those most vulnerable,” — Svein Tore Holsether.
- “These findings are outrageous, but we shouldn’t be surprised,” — Mónica Vargas Collazos, Head of Global Programme, Grain.
Outlook and Next Steps
The European Commission is expected to adopt a Fertiliser Action Plan that would recognise the sector as a strategic pillar of EU autonomy. Reopening the Strait of Hormuz remains uncertain; analysts caution that even a swift agreement could take months for supply chains to normalise. Continued monitoring by the World Bank, FAO and IFPRI will be essential to gauge the longer-term impact on global harvests and food-price stability.
