According to Oxford Economics, an independent economic advisory firm, in late March the price of the two main fertilizer ingredients, ammonia and urea, spiked 20% and 50% respectively in response to disruptions in the Persian Gulf.
Now that Iran has established a blockade and tolling system in the Strait of Hormuz in response to the United States and Israel attacking the country, large amounts of urea, ammonia, phosphates, and sulfur, critical components for fertilizer, are locked out of agricultural supply chains.
While the blockade is not an issue for Russia, the world’s largest exporter of urea, it is a significant issue for Qatar, Oman, and Saudi Arabia, Persian Gulf states currently prevented from exporting urea to market. India, Brazil, and the US are dependent on urea from the Gulf, while China, India, and the US depend on sulfur and ammonia exports from the region.
“The timing of the disruption makes the situation especially acute,” explains the Kiel Institute, a European research institute for global economic affairs. “March and April are peak months for fertilizer application in the Northern Hemisphere planting season. Although some market adjustment may occur over time, structural damage to supply chains and agricultural production is likely to persist.”
On March 9, the American Farm Bureau Federation sent a letter calling on President Trump to ensure safe passage of fertilizer shipments to the United States to stabilize costs and delivery ahead of spring planting season for farmers, the Detroit Free Press reported.
A survey conducted by the federation in early April “shows 70% of respondents say fertilizer is so expensive that they will not be able to buy all the fertilizer they need.” More than 5,700 farmers, both Farm Bureau members and non-members, from every state and Puerto Rico took part in the survey.
The analysis reveals that almost 8 in 10 farmers in the southern U.S. say they can’t afford all needed supplies this year, followed by the Northeast and West at 69% and 66%, respectively, compared to 48% of the farmers in the Midwest.
Trump is oblivious to the fact his war, at the behest of Zionist Israel, is the reason farmers cannot buy the fertilizer required for spring planting. Instead of admitting the war and Iran’s blockade are responsible, he attempted to shift blame. “I am watching fertilizer prices CLOSELY during our FIGHT FOR FREEDOM in Iran,” Trump posted to his Truth Social on April 11. “The United States will not accept PRICE GOUGING from the fertilizer monopoly! American Farmers, we have your back!”
Prior to Trump and Netanyahu’s war, farmers criticized the president for betraying them with his tariffs (under the International Emergency Economic Powers Act) and trade policies, which have led to significant financial losses in the agricultural sector. Trump’s unnecessary war for Israel has exacerbated the crisis.
While the Hormuz Strait blockade contributing to reduced production of fertilizer will produce food shortages and higher prices in the United States, the situation is for more dire elsewhere in the world. In Sudan, Yemen, and Syria, nearly 50 million people face serious food insecurity, while in Gaza, 94% of the population facing food shortages. The situation ongoing in the Strait of Hormuz will deepen the crisis.
If the war and blockade persist into summer, according to the United Nations World Food Program, the “total number of people around the world facing acute levels of hunger [an additional 45 million] could reach record numbers.”
The virtual shipping standstill in the Strait of Hormuz and mounting risks to Red Sea maritime traffic are already increasing energy, fuel, and fertilizer costs, deepening hunger beyond the Middle East. The conflict reverberates far and wide—and the world’s most vulnerable people are the ones who will be most exposed to its ripple effects.
Australian economist Steve Keen, known for predicting the 2008 financial crisis, warns that famine could begin within two months, with India likely among the first hit due to fertilizer shortages. “If we lost 20 per cent of the world’s fertilizer, we’d lose roughly 20 per cent of the world’s food, and it would cause a global famine,” he said. “Food production on the planet could fall 10-25 percent and there simply won’t be enough food for everyone on the planet.”
In addition to enlarging an already serious food insecurity crisis and increasing the possibility of famine, the maritime disruption will intensify economic pressure. “The combination of supply shortages, currency depreciation, and inflation could trigger broader economic instability,” notes the Al Habtoor Group, a United Arab Emirates conglomerate.
As of now, Brent crude prices have surged past $120 per barrel, with projections indicating a potential rise to $190 if the conflict persists. Consequently, major economies, particularly in Europe and Asia, are grappling with escalating energy costs and the looming threat of recession. Additionally, global inflation is anticipated to experience a substantial increase, with estimates suggesting a rise of approximately 7.7%.
In March, inflation surged to its highest level in two years, with energy prices experiencing a significant 10.9% increase over the month. This marked the largest increase since September 2005. On April 7, the average price of gas in the United States reached $4.14. Goldman Sachs issued a warning that predicted Southeast Asian countries may face a complete oil shortage, while the US could potentially lose 60% of its fuel oil capacity.
If Netanyahu and Trump’s war for Zionist hegemony in West Asia continues unabated, according to the globalist IMF, it will create a serious “downsize” for the global economy:
In a severe scenario where energy supply dislocations extend into next year, inflation expectations become markedly less anchored, and financial conditions tighten sharply, global growth would decline to 2 percent this year and next, while inflation would exceed 6 percent. Despite the recent news of a temporary ceasefire, some damage is already done, and the downside risks remain elevated.
For Trump and Wall Street, the head-on financial collision expected for the global economy is not a major concern. “More than six weeks into the war with Iran, investors have repeatedly shrugged off the sky-high price of oil, sending the S&P 500 soaring back to record highs,” reports The New York Times.
That exuberance on Wall Street offers a sharp contrast with the hardships facing many Americans, who are feeling the financial blowback of a conflict that President Trump once promised would be brief but seems to have no end in sight.
The president seems indifferent to the fact that the economy will be a major focus in the upcoming midterm elections, with affordability and economic policies being key issues. Republicans are deluding themselves into believing “economic messaging” will swing voters away from Democrats and retain their majority in Congress.
This week Trump is expected to travel to Arizona and Nevada to promote the GOP tax bill, dubbed the One Big Beautiful Bill Act, in part an attempt to steer attention away from the war and focus on domestic priorities. The administration is teasing an average refund of $3,521 for taxpayers, an increase of 11% from last year, according to the White House.
However, this panacea will not distract voters from the fact food, gas, home heating and cooling, and every consumer item delivered by a truck running on diesel, will cost significantly more, especially if the war for Israel, with zero gain for the American people, will turn voters against Trump and the Zionist billionaires responsible for their lower standard of living.
Reprinted with permission from Another Day in the Empire.
