War in Iran, Middle East Threatens Global Agrifood Systems

Máximo Torero, Chief Economist of Food and Agriculture Organization (FAO), briefs the Security Council meeting on Conflict-related food insecurity: Framing the global dialogue: addressing food insecurity as a driver of conflict and ensuring food security for sustainable peace. Credit: UN Photo/Manuel Elías

By Naureen Hossain
UNITED NATIONS, Mar 27 2026 (IPS)

The current conflict in Iran and the Middle East region threatens to disrupt the global energy and agri-food sectors, as the closure of the Strait of Hormuz affects oil and fertilizer exports for farmers during critical harvest seasons.

The Food and Agriculture Organization (FAO) warns that if the war does not come to an immediate end, global markets could collapse from the high demands for oil and crops.

Within the next two weeks, global markets may be able to absorb the shocks brought on by the war thus far and could therefore minimize the risks of food insecurity, said FAO’s chief economist Máximo Torero.

“If this crisis continues for the next three to six months, then yes, it will have an impact not only on the food security sector; of course, energy will impact all other sectors and all other inputs that have been affected,” Torero said.

The Strait of Hormuz carries up to 30 percent of international trade fertilizers and up to 35 percent of global crude oil and natural gas. Premiums on the costs of these resources are increasing as the war continues in the region. Torero told reporters on Thursday that farmers face the “double choke” of higher prices on fertilizers and rising fuel prices, the latter of which is used by the value chain to produce the food available in markets. With limited supplies, farmers may be forced to adapt their crop cycle by reducing the amount of fertilizer or switch to crops that require less nitrogen fertilizer.

Torero remarked that the immediate impact will be on the next season of crops, which will likely have fewer yields than before the war started. If the fighting concludes within a month, countries with higher reserves of fertilizers and fuels may mitigate shocks to the global markets. If the fighting lasts three months and the Strait of Hormuz stays closed, the shocks will be global and harder to manage. The consequences could include fewer yields from crops and more pressure on global exporters such as the United States, Brazil and Australia. As oil prices increase, this may encourage farmers to switch to biofuels to help meet the demands for crops. Yet such actions may also cause higher consumer prices.

When it comes to the war’s impact in the region, Torero reported that Iran was already dealing with high food prices before the fighting began, which it has only exacerbated. Meanwhile, for Gulf states such as Qatar and the United Arab Emirates, they are largely reliant on food imports and will face more challenges as there are no ships carrying imports through the channel.

Beyond the Middle East, FAO identified certain countries that will be impacted by fertilizer and fuel shortages, such as Sri Lanka and Bangladesh, which are currently in their respective rice harvest seasons, and sub-Saharan countries like Kenya and Somalia, which rely on 22 to 31 percent of fertilizer imports.

One area that will also be affected by the conflict is remittances. Migrant workers from South Asia and East Africa live and work in the Gulf states, including at airports and places of business that have been targeted by military strikes. Torero explained that if these workers cannot send money back to their households in their home countries, the resulting decline in remittance inflow will affect many countries where remittances make up a “significant share” of their GDP.

“There’s a significant amount of labor employment that comes from this region,” Torero said. “Now, if the airplanes are not flying… If the operations that used to flow through the airports are not happening, that will impact of course their economies, and that will impact all these temporary laborers that are working in those locations.”

The rich economies that attract migrant labor could be impacted, Torero said, and the workers whose families rely on remittances would also be severely affected.

While the war in the Persian Gulf continues to threaten the global energy, fertilizer and food markets, the international community is encouraged to take short- and long-term measures to mitigate the shock and protect vulnerable populations.

Torero and FAO recommended developing alternative trade routes to reduce dependence on the Strait of Hormuz. Vulnerable import-dependent countries, including low-income states, need support through emergency food aid, balance-of-payment support and targeted subsidies. Farmers should also be financed to maintain agricultural production and to prevent liquidity constraints.

Torero also recommended that states should diversify their import sources and promote regional coordination. He added that states need to build resilience in the future, which means investing in sustainable domestic agriculture and alternatives to fertilizers and preparing for structural market shifts that may result from prolonged instability.

“We need to treat food systems with the same strategic importance as energy and transport sectors and invest […] accordingly to minimize those shocks.”

IPS UN Bureau Report