Iran war could spark the next global food crisis

"Gulf nations account for 20% of global traded volumes of key fertilizers such as ammonia, phosphates and sulfur, data from the maritime intelligence company Signal Group show. Nearly half the world's traded urea—the most widely used nitrogen fertilizer—comes from the Gulf region, with Qatar accounting for one-tenth of the global supply, according to Bloomberg Intelligence."

"When QatarEnergy last week halted production after Iranian strikes on Ras Laffan, the world's biggest LNG and fertilizer hub, hundreds of thousands of tons of key fertilizer nutrients and precursors were sidelined. The compounding effects of the Iran war threaten the third major risk to global food security in six years, after the COVID-19 pandemic and Moscow's seizure of farmland and ports."

"According to UNCTAD, the United Nations agency that helps developing nations integrate into the global economy, about 1.33 million tons of fertilizer are exported through Hormuz every month. So a 30-day closure of the strait could be enough to trigger shortages and yield risks for nitrogen-dependent crops like corn, wheat and rice."

The Strait of Hormuz disruption from the Iran war poses a critical threat to global food security beyond oil and LNG concerns. Gulf nations control approximately 20% of global traded fertilizer volumes, with Qatar alone supplying one-tenth of global urea production. When QatarEnergy halted production following Iranian strikes on Ras Laffan, hundreds of thousands of tons of fertilizer nutrients were sidelined. Approximately 1.33 million tons of fertilizer transit through Hormuz monthly, making a 30-day closure sufficient to trigger shortages affecting nitrogen-dependent crops like corn, wheat, and rice. Fertilizer prices have risen 10-30% since the conflict began, representing the third major food security threat in six years following COVID-19 and Russia's invasion of Ukraine.

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