A prolonged war involving Iran could significantly disrupt the global food supply this year, according to the chief executive of Yara International, one of the world’s largest fertilizer producers.
Speaking to The Guardian, CEO Svein Tore Holsether warned that continued conflict could drive up fertilizer prices and reduce crop yields, with particularly severe consequences for poorer countries.
“Given the importance of fertilizers, if the war continues for a long time it could have serious impacts on crop production,” Holsether said. “Although the conflict is regional, its consequences are global and it directly affects the food system.”
Since the outbreak of war involving Iran, the prices of key fertilizer inputs have surged sharply. Nearly one-third of the world’s urea supply and about a quarter of globally traded ammonia come from the Gulf region. Urea prices have jumped by around $210 per ton to nearly $700, compared with about $487 per ton in the week before the attacks on Iran.
Holsether also warned that a prolonged disruption in the Strait of Hormuz could trigger a global agricultural crisis. “If the Strait of Hormuz were closed for a year, it would be catastrophic,” he said. “We are talking about plant nutrients, and without them crop production could drop significantly. In some cases, yields could fall by up to 50 percent if fertilizers are not applied.”
Founded in 1905 in Norway, Yara International is the world’s largest producer of nitrogen-based fertilizers. The company operates major production plants in countries including Netherlands, France, Germany, India and across South America.
Holsether said the fertilizer industry is facing a “double blow.” Supply of raw materials from the Gulf has been disrupted, while the cost of natural gas — a key component used to extract nitrogen from the air for fertilizer production — has risen sharply.
He added that fertilizer output has already declined in both Iran and Qatar due to the conflict, while several Asian countries have begun rationing gas supplies. Higher gas prices directly increase fertilizer production costs, further tightening global supply.
Although Europe may be able to absorb the higher costs, Holsether warned that poorer regions, particularly in Africa and neighboring areas, could face severe challenges as wealthier markets outbid them for limited fertilizer supplies.
