Global Economy — 2026-04-12

Hormuz Closure Triggers 98% Collapse in Global Fertilizer Trade, Threatening Food Security During Sowing Season

UNCTAD reported a 98% drop in fertilizer exports through the Strait of Hormuz during March 2026, disrupting 38% of global nitrate-based and 20% of phosphate-based fertilizer supplies. The near-total halt of the region's 22 million tons of annual urea exports has driven nitrogen and phosphate prices up 20-40%. The disruption coincides with Northern Hemisphere sowing season, and the FAO warned the loss of Gulf exports creates an immediate global shortfall with no quick substitutes, with cascading risks for India, Brazil, and China, the world's largest food producers and major Gulf fertilizer importers.

Analysis
The fertilizer disruption is an underreported second-order effect that may prove more destabilizing than the energy shock. Unlike oil, where strategic reserves buffer supply gaps, there are no global fertilizer reserves. The timing during Northern Hemisphere sowing season means crop yields in 2026-27 are already locked in at reduced fertilizer application rates. India, Brazil, and China are simultaneously major food producers and Gulf fertilizer importers. Reduced yields in any of these countries has cascading food price effects globally.

2 sources

From gas to grain: Fertilizer disruptions raise risks for food security and trade - UNCTAD
Strait of Hormuz crisis threatens world fertilizer supply chain - Anadolu Agency