War in Iran Disrupts Global Fertilizer Supplies and Drives Up Long-Term Food Prices

The war in Iran has inflicted economic damage that will persist long after any ceasefire takes hold, threatening to keep food prices elevated and force difficult budgetary decisions across Europe and beyond. Even as military hostilities pause, the conflict's disruption to global fertilizer supplies, energy costs, and agricultural production will continue to ripple through economies worldwide, according to economists and policymakers monitoring the crisis.

The primary culprit is a supply chain shock that struck at the worst possible moment for global agriculture. Disruptions in the Strait of Hormuz — which handles a significant share of global fertilizer trade — have already sent prices for fertilizer ingredients such as ammonia, phosphorus, and potassium sharply higher, while pushing up oil and diesel costs across the supply chain.^[1] Iran accounts for about 3.5% of global urea production and roughly 10% of seaborne urea trade, making it a critical player in agricultural inputs.^[2] For American farmers, the impact has been immediate and severe. One Pennsylvania farmer reported purchasing nitrogen fertilizer for $360 per ton in October 2025; by April, that same product cost over $500 per ton.^[3]

The timing could hardly be worse. The war disrupted a critical planting season, reducing the likelihood of smaller harvests for staple crops like corn, wheat, and rice — crops that feed both humans and animals.^[1] According to the United Nations' Food and Agriculture Organization, world food prices rose 2.4% in March, driven largely by higher energy costs linked to the escalating Middle East conflict.^[2] Supply chain scholars warn that the effects will extend far beyond agricultural producers. Staples like wheat, corn, rice, and sunflower oil are particularly exposed, and disruptions will ripple into meat and dairy products, meaning consumers will face higher costs across multiple food categories.^[1]

In the United States, the most likely outcome is higher grocery bills rather than empty shelves. A best-case scenario could push food prices up by 12% to 18%, adding roughly $100 or more per month to a typical household's budget, according to economic analysis.^[1] In the United Kingdom, farmers have warned that despite the ceasefire, the conflict's damage to their cost structure means higher food prices are already baked in.^[3] The concern is particularly acute for lower-income households, which spend a larger share of their budgets on food and will therefore bear the heaviest burden of these increases.^[4]

The economic shock extends beyond individual households to challenge government policymaking. Italy's Finance Minister Giancarlo Giorgetti has suggested that the European Union should consider pausing budget deficit rules if the Middle East crisis persists, signaling that the continent may face difficult fiscal choices as inflation and slower growth collide.^[4] Higher energy prices are amplifying the broader problem, affecting not just food production but the entire chain of growing, transporting, processing, and storing food.^[4]

While global cereal production is still forecast at a record 3.036 billion metric tons for the year, that forecast offers little comfort to consumers facing persistent inflationary pressure.^[2] The war has already erased some of the relief seen in food prices after the previous inflation spike, and economists warn it could erase more if energy and fertilizer markets remain tight.^[2] For millions of households already struggling with elevated living costs, the economic scars of the Iran conflict will outlast any pause in fighting.