Impact of Iran War on Global Fertiliser Supplies
The disruption to fertiliser supplies and their essential components caused by the war in Iran could jeopardise up to ten billion meals per week worldwide, disproportionately affecting the poorest nations, according to Svein Tore Holsether, chief executive of Yara, one of the largest fertiliser producers globally.
Holsether explained to the BBC that ongoing hostilities in the Gulf region, which have obstructed shipping routes through the Strait of Hormuz, are endangering global food production capabilities.
He cautioned that diminished crop yields due to reduced fertiliser application might trigger competitive bidding for food supplies.
Holsether urged European countries to carefully consider the consequences of a price war on the "most vulnerable" populations in other parts of the world.
While the UK is unlikely to experience food shortages, the rising costs faced by food producers are anticipated to be reflected in weekly grocery bills within the coming months.
"We're up to half a million tons of nitrogen fertiliser not being produced in the world right now because of the situation we are in," Holsether stated.
"What does that mean for food production? I would get to up to 10 billion meals that will not be produced every week as a result of the lack of fertilisers."
He noted that omitting nitrogen fertiliser could reduce yields for certain crops by as much as 50% during the first growing season.
Holsether highlighted the multiple challenges farmers worldwide are confronting, pointing out that the prices they receive for their produce have not yet adjusted to offset the increased expenses they face.
"They're faced with higher energy costs, diesel for a tractor is increasing, other inputs for the farmers are increasing, fertiliser cost is increasing, but yet the crop prices haven't increased to the same extent yet," he explained.
Potential for a Global Food Bidding War
Since the onset of the conflict involving the US and Israel against Iran, fertiliser prices have surged by 80%.
Holsether warned that if the conflict persists, it could lead to a bidding war for food between wealthier and poorer nations.
"If there's a bidding war on food and one that Europe is robust enough to handle, what we need to keep in mind in Europe is, OK, in that situation, who are we buying the food away from?
That is a situation where the most vulnerable people pay the highest price for this in developing nations where they cannot afford to follow that."
This scenario has serious implications for food affordability, scarcity, and hunger, Holsether added.
In the UK, the Food and Drink Federation recently projected that food inflation could reach 10% by December.
The Bank of England also indicated this week that food price inflation might rise to 4.6% in September and could increase further later in the year.
