The ongoing conflict in Iran could seriously threaten global food supplies. Svein Tore Holsether, the CEO of Yara International, one of the largest fertiliser companies, has raised alarms about the impact of this war on food prices, especially for the poorest countries. He emphasizes the vital role of fertilisers in boosting crop yields.
He said, “If this conflict goes on, it will directly affect food systems worldwide.” Since the war began, the prices of key fertiliser materials have surged. For example, the cost of urea has jumped from $487 to $700 per tonne in just a few weeks. Urea and ammonia are crucial components used to enrich soil for crops.
Holsether warned, “If the Strait of Hormuz were shut down for a year, the consequences would be devastating.” He highlighted that without proper nutrients, farms could see yield reductions of up to 50%. This is particularly concerning for crops like early potatoes, which are vital in Europe.
Yara, founded in Norway in 1905, was established to combat famine and has grown into the world’s largest producer of nitrogen-based fertilisers, with operations across Europe, India, and South America. The recent conflict has created a “double impact” on the fertiliser industry: supplies from the Gulf are dwindling, and gas prices, crucial for production, have soared.
In fact, recent data shows that many Asian governments have begun to ration gas due to rising prices, further disrupting fertiliser production in countries like Qatar and Iran. This situation means that wealthier countries could outbid poorer nations in purchasing fertiliser. Holsether pointed out, “In this global auction, Europe’s buying power will outweigh that of many vulnerable countries.”
The United Nations World Food Programme has echoed these concerns. Rising food costs driven by the conflict could increase hunger rates in vulnerable regions globally. This situation calls for urgent attention as food security hangs in the balance.
For more insights on the implications of rising fertiliser costs and global food security, check out this detailed analysis.
