Yara CEO Warns War in Iran Jeopardises 10 Billion Meals Weekly Amid Fertiliser Shortages

The conflict in Iran, initiated by the United States and Israel on 28 February, has severely interrupted the global supply of fertiliser and its essential components. Svein Tore Holsether, chief executive of Yara, a leading fertiliser producer, stated that hostilities in the Gulf have obstructed shipping through the Strait of Hormuz, thereby endangering global food production.

Holsether warned that reduced crop yields, resulting from lower fertiliser use, could instigate a bidding war for food. He urged European nations to consider the severe impact of such a price conflict on the most vulnerable populations in developing countries.

"We're up to half a million tons of nitrogen fertiliser not being produced in the world right now," Holsether stated. He estimated this shortfall translates to "up to 10 billion meals that will not be produced every week as a result of the lack of fertilisers." He highlighted that not applying nitrogen fertiliser could diminish crop yields by as much as 50% in the initial season for some crops.

Farmers globally are grappling with escalating challenges. While their operational costs, including energy, diesel, and fertiliser, have significantly increased, crop prices have not risen commensurately. The price of fertiliser has surged by 80% since the commencement of the US and Israel's military operations in Iran.

Holsether further cautioned that a prolonged conflict could result in richer nations outbidding poorer ones for available food supplies. "If there's a bidding war on food and one that Europe is robust enough to handle, what we need to keep in mind in Europe is, okay, in that situation, who are we buying the food away from?" he questioned, adding that "the most vulnerable people pay the highest price for this in developing nations where they cannot afford to follow that." This situation, he concluded, bears grave implications for "food affordability, food scarcity and hunger."

Although the UK is not expected to face immediate food shortages, the escalating costs for food producers are projected to translate into higher weekly food bills within months. The Food and Drink Federation has forecasted that food inflation could reach 10% by the end of the year.