Iran War’s Long-Tail Effects on UK Food Prices and Supply Through 2027

The ongoing United States-Iran conflict, especially the closure of the Strait of Hormuz, is expected to keep UK food prices elevated and create intermittent shortages, with experts projecting effects persisting into 2027.

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War-related disruptions have halted fertiliser shipments, driven up red diesel and energy costs, and threaten carbon-dioxide supplies essential for meat processing, brewing and packaging.

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Darren Jones, Tom Bradshaw, Scott Walker, Aled Jones, Derek Watson, Andrew Crook, Sir Keir Starmer, Food & Drink Federation, Yara International.

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The Food & Drink Federation projects 9 % food inflation by end-2026, adding about £470 to the grocery bill. Red diesel rose from 76p/L to 104p/L; fertiliser costs now exceed pre-war levels, with yield losses up to 50 %. Milk, potatoes, bread, meat and chicken prices are expected to rise.

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Higher grocery bills, potential gaps for tomatoes, cucumbers and peppers from May, and shrinkflation of chocolate, biscuits and fish-and-chip portions are already reported. Reduced meat and poultry availability may follow CO2 supply strains.

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A government spokesperson said the UK is “taking the effects of the Iran war seriously”, is “actively monitoring” the sector, and has a “resilient food system”. The Food & Drink Federation notes no shortage but warns of price pressure, and has restarted a Teesside bioethanol plant to boost CO2 output.

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Farmers’ unions warn of insufficient red diesel and fertiliser, urging policy support. Scott Walker says 2027 contracts must reflect a doubling of red diesel and fertiliser costs. Andrew Crook cautions that pressure could force further shop closures despite customer support.

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Fish-and-chip shops have reduced portion sizes; glasshouse growers may cut season lengths, limiting fresh produce.

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The government says CO2 supplies are secure, yet experts warn a disruption could curtail meat output. Price-rise timing also varies between autumn 2026 and 2027.

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• “long tail” impact of the Iran conflict could last up to eight months after any deal to reopen the Strait of Hormuz. — Darren Jones, Chief Secretary to the Treasury

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• “understandably worried” about getting enough red diesel and fertiliser for their combine harvesters. — Tom Bradshaw, NFU President

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• “For farmers, some of the impacts from red diesel and fertiliser costs will have a longer tail, so the impact on prices on the things like bread, cereals, potatoes may not come until autumn, [and continue] into next year,” — Aled Jones, Director, Global Sustainability Institute

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• “What’s happened already [with the Iran crisis] is going to have reverberations in the medium to long term. Mostly definitely food price increase will continue well into 2027.” — Derek Watson, Associate Professor, University of Sunderland

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The government will continue stakeholder meetings, monitor fuel, fertiliser and CO2 markets, and assess bioethanol output. Supermarket chains are set to renegotiate 2027 contracts, while growers plan planting adjustments for the next season.

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