World's Largest Fertilizer Firm Warns Iran War Could Trigger Food Shortages in Africa

The CEO of Yara International, the world's largest fertilizer producer, Svein Tore Holsether, has warned that war with Iran could have 'severe consequences,' leading to food shortages and soaring prices for some of Africa's poorest and most vulnerable communities.

Speaking in London, Holsether said global leaders must avert the risk of surging fertilizer prices and scarcity, which would create a 'global auction' that leaves the poorest countries, particularly in Africa, struggling to secure supplies they can barely afford.

'The most important thing we can do right now is to sound the alarm about what is happening – the risk of a global auction on fertilizer, making it too expensive for the most vulnerable,' he said.

Yara International is a Norwegian multinational with plants in 60 countries and operations in 140 nations.

According to financial intelligence firm S&P Global, the conflict's impact is already deeply embedded in supply chains. Chris Rogers, Head of Supply Chain Research at S&P Global Market Intelligence, said: 'Food supply chains face both direct and indirect challenges from fuel and fertilizer restrictions. Africa's reliance on nitrogen-based fertilizer from the Middle East varies widely, with Ethiopia and Kenya among the hardest hit in sub-Saharan Africa.'

With 35% of the world's urea supply – a key fertilizer ingredient – coming from Gulf states, Yara has seen supply tighten and urea prices rise '60% to 70% since the US and Israel launched their campaign against Iran in late February.' Holsether stressed that this price hike 'has quite severe consequences for those who cannot afford it.'

In addition, the supply of ammonia – the basic raw material for nitrogen-based fertilizers – has been severely affected. Ammonia is a toxic substance that can cause severe respiratory damage, and storage during war carries so much risk that some countries, such as Qatar, have halted production entirely. 'We are losing output every day. It will take weeks or months to restart,' Holsether said of the general fertilizer production situation.

Fertilizer for the upcoming planting season in sub-Saharan Africa poses a challenge for local farmers, but they will also face the problem of building stockpiles for the 2027 harvest – a routine part of farming planning.

The European Union (EU) has moved to support farmers, but Holsether argued that similar support must be extended to sub-Saharan Africa. 'We need to treat agriculture as a business,' he said.

Earlier this week, the EU relaxed state aid rules for industries and offered up to 50,000 euros (£43,200) per farmer to cover increased fuel or fertilizer costs from the Iran war. However, no such support exists in Africa, where they also start from a position of degraded land and low food reserves.

'In Europe, soil and cultivation conditions are already quite optimized, so farmers can reduce fertilizer use somewhat without a major impact on yields,' Holsether explained. 'But it is not the same in other parts of the world. There, fertilizer use was already sub-optimal to begin with. Africa is where I am most worried right now. Once again, we are in a situation where the most vulnerable pay the highest price.'