Iran Conflict: Global Food Security at Risk

A potential war between the U.S.-Israel and Iran is raising serious concerns about global food security, with officials warning of a new food price shock that could push tens of millions into acute hunger. The conflict's impact on crucial trade routes and fertilizer supplies is already being felt worldwide.

Disruptions to Key Trade Routes

Rising energy, shipping, and fertilizer costs, fueled by potential disruptions to the Strait of Hormuz – a vital trade route – are impacting countries globally. While the U.S. is experiencing these effects, poorer, import-dependent nations are expected to bear the brunt of higher costs.

Roughly one-third of all globally traded fertilizer shipped by sea passes through the strait. Any sustained disruption could quickly ripple across food production and prices, impacting farmers worldwide.

Fertilizer Shortages and Rising Costs

The conflict has already destabilized oil markets, but a growing concern is the availability and price of fertilizer. Liquefied natural gas (LNG), a key ingredient in nitrogen fertilizers like urea, is facing shipping delays and uncertainty, leading to soaring prices.

Impact on Farmers

Jacob Jumpha, a farmer in Malawi, which receives 61.6% of its fertilizer from the Gulf, expressed concern: “The war is likely to hit Malawi hard, especially in terms of fertilizer shortages.” He highlighted the potential for price surges or even shortages due to manufacturing and shipping disruptions.

Ebony Loloji, director of the National Union for Small Scale Farmers of Zambia, stated that most of the country’s fertilizer comes from the Middle East, predicting potential supply chain disruptions and affordability issues.

In Brazil, Agriculture Minister Carlos Fávaro warned of price increases in urea and potential supply disruptions. India’s Prime Minister Narendra Modi has announced measures to ensure fertilizer supplies and protect farmers.

Global Production and Supply Chain Effects

The duration of the war will be critical. Máximo Torero, chief economist of the Food and Agriculture Organization of the United Nations, stated that a disruption of up to one month could be absorbed, but three months or longer would significantly escalate risks.

Tangible effects are already spreading. Fertilizer plants in India, Algeria, and Slovakia have reduced or halted production due to rising natural gas prices. Australian wheat farmers are planting less, and China has restricted fertilizer exports. In the U.S., ammonia and urea prices have risen by 41% and 21% respectively.

Expert Analysis

Chris Lawson of CRU Group warned, “The longer this war continues and the Strait of Hormuz remains closed, the greater the chance there is of reduced agricultural production.” He added that countries like Australia and less developed regions would be most impacted due to high prices and limited affordability.

Worsening Global Hunger

The World Food Programme (WFP) warns that surging fuel and fertilizer costs, combined with shipping disruptions, could push an additional 45 million people into acute hunger, bringing the global total to a record level of 319 million. Carl Skau, WFP Deputy Executive Director, described this as a “terrible, terrible prospect.”

Catherine Russell, UNICEF Executive Director, highlighted the impact on aid delivery, noting potential transport cost increases of 30% to 60%, or even double on some routes, leading to increased suffering for children.

East African nations, heavily reliant on fertilizer imports from the Gulf, are particularly vulnerable. Approximately 4 million Malawians (22% of the population) already face acute food insecurity. Aid-reliant nations like Somalia are also at risk.

Even as negotiations are discussed, the potential for a prolonged conflict remains, and the ripple effects, as described by Torero, are likely to be felt for the remainder of the year and beyond.