U.S.-Iran War Disrupts Global Fertilizer Supply via Strait of Hormuz

The conflict has significant implications for food security worldwide, particularly in regions heavily dependent on imported agricultural products.

• On March 27, 2026, the U.S.-led war in Iran led to severe bottlenecks in fertilizer shipments through the Strait of Hormuz.
• Iran's Islamic Revolutionary Guard Corps imposed controlled transits, stranding nearly one-third of global fertilizer exports and causing price spikes.
• Global agricultural production is at risk, with countries like India and regions in the Persian Gulf facing acute food supply challenges.

• The Strait of Hormuz is a critical chokepoint for approximately one-third of global seaborne fertilizer trade, making it vital for agricultural supply chains.
• Previous conflicts, such as the Russia-Ukraine war, have shown how geopolitical tensions can disrupt fertilizer supplies and elevate costs, impacting food production.
• Natural gas prices have surged, leading to plant shutdowns in key fertilizer-producing countries, further exacerbating the crisis.

The ongoing U.S.-led military intervention in Iran has escalated tensions in the region, prompting Iran to exert control over the Strait of Hormuz, a crucial maritime route for global fertilizer shipments. As of March 2026, nearly one-third of the world's fertilizer exports are trapped due to Iranian restrictions, leading to immediate price increases—urea prices have surged by 50%, while ammonia prices rose by 20%. This disruption mirrors previous agricultural shocks, such as those seen during the Russia-Ukraine conflict, where energy supply issues halted fertilizer production.

The fertilizer supply chain is intricately linked to natural gas prices, as many fertilizer plants rely on this resource for production. With rising natural gas costs, several plants in India, Algeria, and Slovakia have shut down, compounding the global supply crisis. Additionally, China has imposed restrictions on fertilizer exports, further limiting availability. The World Trade Organization has issued warnings about severe food supply risks, emphasizing the interconnectedness of global agricultural markets.

As a result, farmers in various regions are adjusting their planting strategies. For instance, Australian wheat farmers have already reduced their planting due to fertilizer shortages. In the U.S., farmers are petitioning the government for support, including loan guarantees and deregulation, to mitigate the impact of rising costs. The situation is precarious, with experts predicting that developing nations will face the brunt of food price surges, leading to potential food insecurity.

The ripple effects of this conflict are likely to be felt across the globe, particularly in import-dependent regions. Countries in the Persian Gulf, as well as others reliant on imported grains and fertilizers, are bracing for shortages. The urgency to secure fertilizer supplies is driving nations to explore alternative sourcing options, which may lead to further market volatility.

• Farmers in the U.S. and Australia facing increased costs and reduced planting capacity.
• Consumers in developing nations experiencing rising food prices and potential shortages.
• Import-dependent countries in the Persian Gulf and South Asia, particularly those relying on grains and fertilizers.
• Agricultural sectors in regions with high natural gas dependency, leading to production slowdowns.

• Fertilizer price trends: Monitoring price fluctuations will indicate the severity of the supply crisis and its impact on agricultural production.
• Government interventions: Watch for policy changes or financial support measures from governments in response to the crisis, particularly in the U.S. and affected countries.
• Global shipping routes: Changes in shipping patterns due to the conflict could signal longer-term impacts on supply chains and costs.