Hormuz Disruption Triggers Global Urea Shortage Threatening 65–70% Of Global Supply

The Hormuz disruption has escalated from an energy shock into a global fertilizer supply shock that could threaten a large share of the world’s urea—some estimates warn as much as 65%–70% of global supply.

“Energy shock to food prices: How Iran war is raising global inflation risks Economists warn the impact of the US-Israel war with Iran could soon be felt in supermarket prices around the world - Rising oil prices and shipping disruptions linked to the war are beginning to filter through global food systems, say experts - ‘There are three main channels of impact – three F’s: fuel, fertilizer and financial markets,’ says Chris Barrett, an agricultural economist at Cornell University The US-Israel war with Iran is beginning to affect more than just energy markets, as economists warn its impact could soon be felt in supermarket prices around the world”

Anadolu Agency

About one-third of the world’s sea-borne fertilizer trade passes through the Strait of Hormuz.

Anadolu Agency

Fertilizer prices have already jumped sharply, with Middle East urea prices up more than 90 USD per metric ton in one week (a 19% rise) and roughly 40% higher than before the war.

Shipping-insurance premiums have surged as insurers adjust to higher risk in Hormuz routes.

The resulting dynamics threaten broader inflation and food-price pressures, especially for fertilizer-dependent crops.

Lower fertilizer application can significantly reduce yields.

Farmers may respond by reducing fertilizer use or shifting to crops that require fewer inputs.

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Kenya has seen fertilizer costs rise, signaling broader yield risks.

The World Food Programme cautions that the impact will be felt most by vulnerable populations.

Nutrien reported potash adjusted EBITDA of $2.25 billion and projected global potash shipments of 74 to 77 million tonnes in 2026.

“Skip to main content Listen to article As the Iran war rattles global supply chains, one unlikely corner of the Canadian market is cashing in: fertilizer stocks”

Canada's National Observer

Shipping insurance premiums have surged after insurers expanded high-risk zones, with war-risk coverage rising from about 0.25 percent to as much as 10 percent of a vessel’s value.

There are three main channels of impact — three F’s: fuel, fertilizer and financial markets.

Attacks on key energy infrastructure and disruptions in LNG supplies are impacting fertilizer production worldwide, especially urea.

Not all countries are in the same position to face this crisis; Brazil and Argentina seem comparatively more capable of absorbing the shock.

If resolved within weeks, global markets could absorb the shock, but a prolonged crisis lasting three months or more could produce larger, lasting price pressures.