TD
Impact of Strait of Hormuz Closure on Fertilizer Supply
Pages
5
Time to read
12 mins
Publication
Language
English
Pages
5
Time to read
12 mins
Publication
Language
English
This technical report outlines the significant disruptions in the global fertilizer market caused by the closure of the Strait of Hormuz. It details how this closure has not only raised energy prices but has also directly impaired the supply chains for nitrogen and phosphate fertilizers, which are critical for food production. The report explains that roughly one-third of the global seaborne fertilizer trade transits through this strait, making it a critical chokepoint. The analysis highlights the uneven impact of these disruptions, particularly on fertilizer-import dependent emerging markets, where food constitutes a significant portion of household budgets. It discusses the potential for increased food price pressures extending into 2027 due to higher fertilizer costs and the implications for crop yields. The report also examines the varying exposure levels across different regions, noting that while North America may be less affected in terms of supply, it is still vulnerable to price increases. The report concludes by emphasizing the broader implications for global food security.