The Coming Fertiliser Crisis: How the War on Iran Is Threatening Global Food Supply

There is a connection between a missile strike on an Iranian gas processing facility and the price of bread in Cairo, Lagos, or Dhaka — but it runs through a chain of industrial dependencies so long and so poorly understood by the public that by the time the link becomes visible, the damage is already done. The 2026 conflict involving Iran is not just an energy market event. It is, potentially, a food security event — one whose full consequences will ripple outward through fertiliser markets, grain prices, and the caloric intake of hundreds of millions of people over the next twelve to twenty-four months.

The mechanism is not complicated, once you trace it. Modern industrial agriculture runs on nitrogen fertiliser. Nitrogen fertiliser is manufactured from ammonia. Ammonia is synthesised from natural gas. Natural gas flows in enormous quantities through and around the Persian Gulf — a region now under active military pressure. Add the world’s most important maritime chokepoint, a region that produces roughly a third of globally traded nitrogen fertiliser, and a conflict that is driving gas prices higher everywhere, and you have the conditions for a fertiliser shock that could translate directly into a food supply shock for the world’s most vulnerable populations.

The Chain That Connects War to Wheat: Natural Gas and the Haber-Bosch Process

To understand the fertiliser crisis, you need to understand one of the most important — and least discussed — industrial processes in human history. The Haber-Bosch process, developed by German chemists Fritz Haber and Carl Bosch in the early twentieth century, is the method by which atmospheric nitrogen is converted into ammonia under high temperature and pressure, using natural gas as both the energy source and the hydrogen feedstock. From ammonia, the fertiliser industry produces urea, ammonium nitrate, and diammonium phosphate — the three nitrogen compounds that sustain the yield levels on which modern agriculture depends.

The numbers are staggering in their implications. Without synthetic nitrogen fertiliser, the global agricultural system could support roughly half the current human population. The other half — approximately four billion people — exist because of Haber-Bosch. This is not a metaphor or an approximation: it is the consensus estimate of food scientists. When the process becomes more expensive to run, or when the gas that feeds it becomes scarce, the food system contracts. Not immediately, not uniformly, and not in the countries that can afford to absorb the cost — but it contracts, and the contraction is felt first and hardest by those who are already at the margin.

Natural gas typically accounts for 70–90% of the production cost of ammonia. This is why fertiliser prices track gas prices with remarkable fidelity. When European gas prices spiked following the 2022 Ukraine war — reaching levels more than ten times higher than their pre-war average — European ammonia plants shut down en masse. At the peak in late 2022, more than 70% of European ammonia production capacity was offline. The continent that had supplied a significant share of global nitrogen fertiliser suddenly imported it instead, bidding against developing-world buyers for a constrained global supply. Food prices followed. The UN Food and Agriculture Organisation’s Food Price Index reached an all-time high in March 2022, and while it has since retreated, it has not returned to pre-2021 levels. The world is still absorbing the first shock. The second is now beginning.

Iran’s Position in the Global Fertiliser System

Iran is not a peripheral actor in the global fertiliser market — it is a significant one, made more consequential by the fact that it has been operating outside Western supply chains for years due to sanctions. Iran holds the world’s second-largest natural gas reserves, after Russia, and has used that resource base to develop one of the largest fertiliser production industries in Asia. The country operates a string of large petrochemical and fertiliser complexes along its southern coast, including the Pardis, Khorasan, and Persian Gulf special economic zone facilities, which together produce tens of millions of tonnes of urea and ammonia annually.

Under maximum pressure sanctions, much of Iranian fertiliser output has flowed through informal channels to buyers in South Asia — particularly India, which has historically been one of the world’s largest urea importers — and to China, which has mediated transactions that bypass U.S. dollar clearing. The 2026 conflict has disrupted this shadow supply chain in two ways. Direct damage to Iranian industrial infrastructure — gas processing facilities, port capacity, and pipeline networks in Khuzestan and along the southern coast — has reduced production. And the intensification of sanctions enforcement, combined with the risk premium now attached to any vessel operating in or near Iranian waters, has further constrained what can be exported even from undamaged facilities.

The Qatar Problem: Hormuz Risk and the World’s Biggest LNG Exporter

Iran’s direct fertiliser output is significant but not irreplaceable in isolation. The more systemic risk comes from the geography of the conflict. The Strait of Hormuz — the eighteen-mile-wide passage between Iran and Oman through which approximately one-fifth of the world’s oil passes — is also the exit route for Qatar’s LNG exports. And Qatar is not a peripheral LNG producer: it is the world’s largest, accounting for roughly 22% of globally traded liquefied natural gas. Its North Field, shared with Iran’s South Pars, is the largest single natural gas reservoir on earth.

Qatar exports LNG to Europe, Japan, South Korea, India, and China — and it also exports ammonia and urea at scale, making it one of the largest fertiliser exporters in the world. Every tonne of Qatari LNG or fertiliser that leaves the Gulf must pass through the Strait of Hormuz. Iran has, on multiple occasions, threatened to close or mine the strait in response to military pressure — and while Qatari gas infrastructure and export terminals have not been directly targeted, the insurance and shipping risk premium attached to any vessel in the region has risen dramatically since the conflict escalated.

The practical consequence is a dual squeeze on global gas and fertiliser markets. Iranian production is constrained by direct damage and sanctions enforcement. Qatari exports face elevated shipping risk and insurance costs that, even if they do not produce an actual supply interruption, drive up the delivered cost of the gas and fertiliser that does get through. European buyers — still rebuilding their gas storage positions after the Russia shock — are bidding aggressively for every available LNG cargo, competing directly with the South Asian and African buyers who depend on affordable imports to keep their agricultural systems functioning.

Approximately 21 million barrels of oil per day pass through the Strait of Hormuz — roughly 21% of global petroleum consumption. But it is also the transit route for around 20% of globally traded LNG, most of Bahrain’s and Kuwait’s hydrocarbon exports, and the entire offshore export capacity of Qatar. A closure or even a sustained risk premium on the strait does not just affect the oil market discussed in the context of the petrodollar — it affects the gas market that feeds the fertiliser industry that feeds the world. The two crises are not parallel; they are the same crisis expressed in two different commodity systems.

The Second Shock on Top of the First: Russia, Ukraine, and Unfinished Business

To understand why the Iran-driven fertiliser pressure is so dangerous, you have to understand the baseline it is operating against. Russia is, by a significant margin, the world’s largest exporter of fertilisers — not just nitrogen, but potash and phosphate as well, the other two macronutrients that modern agriculture depends on. Following the 2022 invasion of Ukraine, Western sanctions technically excluded fertilisers from the most restrictive measures, explicitly to avoid a food security catastrophe. But the reality of sanctions enforcement, shipping insurance, payment processing, and port access meant that Russian fertiliser exports were severely disrupted in 2022 and have never fully normalised.

The world adapted — imperfectly. India increased its imports from alternative suppliers. African buyers sourced from Egypt, Morocco, and the Gulf. Brazil, one of the world’s largest agricultural exporters and one of its most fertiliser-import-dependent, scrambled to diversify away from Russian supply. But the adaptation was partial, expensive, and fragile. Global fertiliser inventories are thin relative to historic norms. Prices remain elevated. Many of the alternative supply routes that replaced Russian exports now run through the Gulf — the exact region now under pressure.

Who Gets Hurt: The Geography of Fertiliser Vulnerability

Fertiliser price shocks are not experienced equally. In wealthy, highly mechanised agricultural systems — the United States, Northern Europe, Australia — fertiliser is a significant but manageable input cost. Farmers adjust application rates, switch crop mixes, or absorb the cost into higher commodity prices that are passed through to consumers as food inflation. Painful, but survivable. In lower-income agricultural systems — sub-Saharan Africa, South Asia, parts of Central America and the Middle East — the dynamic is entirely different.

African smallholder farmers are among the world’s most fertiliser-constrained even in normal conditions. Average fertiliser application rates across sub-Saharan Africa are approximately 17 kg per hectare — compared to 140–200 kg per hectare in South and East Asia and more than 200 kg in Western Europe. The chronic under-application of fertiliser is the single largest factor suppressing African agricultural yields below their potential, keeping food insecurity endemic across a continent with some of the world’s most fertile land. When global fertiliser prices spike, African governments that subsidise fertiliser purchases — already fiscally stretched after years of debt accumulation and post-COVID spending — face impossible arithmetic: cut the subsidy, reduce access further, and watch yields fall; or maintain the subsidy, blow out the budget, and face currency crises and credit downgrades.

India is the world’s second-largest consumer of nitrogen fertiliser, importing approximately 8–10 million tonnes of urea annually in normal years. The country runs some of the world’s largest fertiliser subsidy programmes — the difference between market price and what farmers pay is funded by the central government, which in high-price years has run fertiliser subsidy bills exceeding $20 billion. Those subsidies have been politically untouchable because Indian smallholder agriculture remains one of the primary income sources for several hundred million people. A sustained fertiliser price shock forces the government to choose between fiscal discipline and agricultural stability — and in India’s electoral context, the choice has historically been obvious. Bangladesh, Pakistan, and Sri Lanka — the last of which partially collapsed in 2022 partly in response to fertiliser subsidy cuts — face similar dynamics with far smaller fiscal buffers.

The Timing Problem: Planting Seasons Don’t Wait for Peace Talks

One of the most underappreciated features of fertiliser shocks is their irreversibility within a growing season. Unlike oil, where demand can adjust — drivers cut trips, industries reduce consumption — agricultural fertiliser demand is calendar-driven and largely inelastic. Crops are planted in specific windows. Nitrogen is applied at specific growth stages. Miss the window with insufficient fertiliser, and you cannot correct the yield outcome later in the season. The consequence of a fertiliser shock is not felt in the month the shock occurs: it is felt in the harvest that follows — four to eight months later — and in the food prices and hunger statistics that follow the harvest.

The Iran conflict escalated in early 2026, precisely as the spring planting season was approaching across much of the Northern Hemisphere and as South Asian farmers were making their Kharif season input purchasing decisions. Indian urea procurement — both government and private — typically peaks between January and April. Pakistani wheat planting for the upcoming season requires fertiliser purchases in the February-March window. The timing of the Iran shock is, from an agricultural calendar perspective, close to the worst possible.

The Food-Security-to-Political-Instability Pipeline

The relationship between food price spikes and political instability is one of the most robust findings in the political science literature of the last fifteen years. The Arab Spring of 2010–11 was immediately preceded by the global food price spike of 2010–11, itself partly driven by Russian wheat export bans following a catastrophic drought. The Sahel political crisis — the wave of military coups across Mali, Burkina Faso, Niger, and Chad between 2021 and 2023 — coincided with sustained food price elevation following the Ukraine war. Sri Lanka’s 2022 political collapse followed, in significant part, from the government’s ill-timed decision to ban synthetic fertilisers in 2021 combined with the subsequent price surge.

The pattern is consistent: when food expenditure rises beyond approximately 60% of household income, political tolerance for governance failures collapses. In the countries most exposed to the Iran-driven fertiliser shock — where food already represents 40–60% of household spending — the margin between stability and crisis is thin. A 20–30% increase in staple food prices, of the kind that a sustained fertiliser supply disruption can produce within one to two harvest cycles, can cross that threshold for tens of millions of households simultaneously.

The 2022 fertiliser shock following the Ukraine war has provided a live laboratory for exactly this dynamic. Urea prices peaked at over $900 per tonne in late 2021 and early 2022 — compared to pre-pandemic levels below $300 per tonne. The subsequent food price inflation contributed measurably to economic distress across South Asia and Africa. Bangladesh faced its worst foreign exchange crisis in decades. Pakistan’s government collapsed amid an economic implosion that had fertiliser costs as one of its contributing factors. Sri Lanka’s president fled the country. Across the Sahel, already fragile governments found their remaining legitimacy evaporate under the combined pressure of food costs, fuel costs, and debt service on loans taken during cheaper times.

Those consequences flowed from a disruption centred on Russia — a country that, while a major fertiliser exporter, was not itself a chokepoint for global energy shipping. The Iran conflict has disrupted a geography that is a chokepoint. The potential scale of the second shock is therefore larger than the first, even if the Iranian and Qatari production volumes involved are smaller than Russia’s total fertiliser export capacity.

What the Market Is Doing — and What It Isn’t Pricing

As of mid-March 2026, global urea prices have risen approximately 25–35% from their January 2026 baseline, reflecting the initial supply risk premium from the Iran conflict. European gas prices have spiked sharply, driven by Hormuz risk premiums and the redirection of LNG cargoes toward European buyers competing for supply. But several analysts and commodity observers have noted that the market is not yet fully pricing the compounding risks — particularly the lag between current supply disruptions and their realisation in planted acreage and eventual harvest outcomes.

Fertiliser futures markets, unlike oil markets, are relatively thinly traded and less liquid — they do not provide the same real-time price discovery mechanism that oil futures offer. The consequence is that fertiliser price shocks tend to appear suddenly in physical markets when farmers and distributors try to procure supply at the seasonal peak, rather than being smoothly discounted in advance. The shock, when it fully hits, tends to hit faster and harder than financial markets suggested it would.

The Structural Solutions — and Why They Take Too Long

The structural answer to fertiliser supply vulnerability is well understood, even if it is politically difficult to implement at speed. Diversification of production geography — reducing dependence on Gulf and Russian suppliers by expanding capacity in North America, Africa, and Central Asia — is achievable over a five-to-ten-year horizon. Precision agriculture technologies that reduce per-hectare fertiliser application without reducing yields have demonstrated real-world effectiveness. Biological nitrogen fixation research, which aims to give non-legume crops the ability to fix atmospheric nitrogen directly, could eventually reduce Haber-Bosch dependence — but remains years from commercial scale.

None of these solutions are available on the timeline of the 2026 planting season. The countries most affected cannot build new ammonia plants before the Kharif sowing window closes. They cannot pivot to precision agriculture without the extension services, equipment, and knowledge infrastructure that takes years to build. What they can do — and what will happen, regardless of how the Iran conflict resolves — is pay more, plant less, or accept lower yields. All three outcomes translate, with varying lags and degrees of severity, into reduced food availability and higher food prices for the populations least able to absorb them.

A Crisis Hidden Inside a More Visible One

The great danger of the Iran-driven fertiliser crisis is that it will remain invisible for the months it takes to manifest in harvest outcomes and food prices — buried under the more immediate, more photogenic crisis of missile strikes, oil market volatility, and great-power confrontation. Oil market disruptions produce visible price signals within days. Fertiliser shortages produce hunger statistics within seasons. The financial media tracks the first obsessively; it notices the second only when it generates the kind of political instability that cannot be ignored.

But for the farmer in Bihar who cannot afford the urea he needs for his wheat crop, or the government in Dakar trying to decide whether to cut the fertiliser subsidy or the health budget, the crisis is not hidden at all. It is the most concrete and immediate fact of their economic existence. The connection between a conflict in the Persian Gulf and food on the table in South Asia or West Africa is not an abstraction — it is a chain of industrial dependency that runs through every barrel of gas, every tonne of ammonia, every bag of urea, and every kilogram of grain that those systems produce.

Understanding that chain — and the vulnerability it creates — is the first step toward taking it seriously before the consequences arrive, rather than after.