Fertiliser crisis: Yara warns Iran war could hit Africa food supplies

Svein Tore Holsether, chief executive of Norway’s Yara International, said the ongoing conflict in Iran risks disrupting fertiliser supplies to the point that some of Africa’s poorest communities could face food shortages and sharp price rises. He warned of a potential “de facto global auction” for scarce fertiliser that would price out the most vulnerable buyers.

The shock has unfolded as shipments through the Strait of Hormuz and Gulf production of urea and ammonia have been curtailed. Industry data and market analysis indicate that a significant share of seaborne urea originates from Gulf producers, and recent stoppages and higher freight costs have tightened prompt markets. Reuters reporting highlights production losses and the time needed to restart idled plants, which together have driven up spot prices and narrowed available supplies.

Higher input costs are translating into increased risks for crop yields and food inflation. International institutions and Reuters analyses have warned that disruptions to fertiliser and energy supplies will feed through to food prices and could roll back development gains in countries already under stress. The timing matters: delayed deliveries ahead of key planting seasons exacerbate the risk of lower yields in the near term.

In the near term, agricultural producers and traders are adjusting sourcing and logistics, but lower-income importers are vulnerable to being outbid by wealthier buyers. Extended disruptions could force shifts in cropping decisions and reduce overall production of nutrient-intensive staples, altering regional supply balances and export flows. Reuters commentary underlines that clearing transport bottlenecks and restarting production will take weeks to months in many cases.

Market participants expect continued price volatility until supply normalises or alternative supply sources are mobilised. Yara’s recent quarterly disclosures show the company is benefiting from higher margins amid the tight market but also highlight operational risks and the sensitivity of agricultural supply chains to geopolitical shocks. Policymakers face pressure to coordinate emergency aid and trade measures to shield the most vulnerable populations from an acute food-price shock.