Strait of Hormuz Closure: Global Fertilizer Crisis and Food Security Risks

The global landscape is facing a dual crisis as the ongoing tensions involving Iran have led to the closure of the Strait of Hormuz, a move that has pushed crude oil prices beyond $100 per barrel and triggered a burgeoning threat to global food security.

According to reports from Al Jazeera, Ibrahim Jabari, a senior advisor to the IRGC Commander-in-Chief, claimed on March 2 that the strategic waterway had been closed, an action that experts warn will have devastating consequences far beyond energy markets.

The disruption of this vital maritime route has placed the global fertilizer supply chain under extreme pressure, specifically affecting urea, which is essential for modern agriculture.

Much of the world’s urea is produced in Gulf nations and transported through the Strait, but gas supply interruptions and shipping blockades are now causing regional factories to either shut down or drastically reduce output.

The impact is already visible as QatarEnergy recently halted production at one of the world’s largest urea plants due to gas shortages. This ripple effect is being felt globally; India has been forced to scale back its domestic urea production, Bangladesh has closed the majority of its fertiliser factories, and the United States is bracing for a 25% shortfall in fertilizer availability.

Experts indicate that urea prices have already surged by approximately 40%, with further hikes expected for other essential fertilizers. The vulnerability is particularly high for countries like Brazil, which relies almost entirely on imports, and India, which draws over 40% of its supply from the Gulf.

With the region accounting for nearly 46% of the global urea trade, the current blockage threatens the sowing season in the Northern Hemisphere.

Without adequate fertiliser, yields for staple crops such as wheat, rice, corn, and soybeans are expected to plummet, leading to an inevitable rise in food prices and the potential for widespread shortages in more vulnerable nations.