FT predicted a food crisis due to the conflict in the Middle East
The conflict in the Middle East could trigger a global food crisis due to a reduction in fertilizer supplies. This was reported on March 14 by the Financial Times newspaper.
"According to experts, a war in the Middle East could lead to a global food crisis. <...> A shortage of fertilizers threatens food production on many continents," the article says.
According to the newspaper, as a result of the escalation of the conflict, the supply of carbamide, the world's most common nitrogen fertilizer, was disrupted. Of the 2.1 million tons of carbamide, about half did not reach the market. According to Kpler, more than 1.1 million tons of fertilizers have accumulated in the Persian Gulf.
"Nitrogen fertilizers, which account for about half of global food production, are produced from ammonia using natural gas, the price of which has risen sharply since the outbreak of war in the Middle East," writes the Financial Times.
The Middle East is at the center of global fertilizer and energy supply chains. About a third of global urea exports pass through the Strait of Hormuz, which was previously blocked by Iran. Fertilizer plants in some Asian countries have suspended production due to a shortage of natural gas. Since the beginning of the Middle East conflict, the cost of carbamide has increased by more than 40%.
On March 6, Mikhail Dyakonov, founder and CEO of the freight logistics company Freit Logistics Group, assessed the impact of the blocking of the Strait of Hormuz on global cargo transportation. The expert recalled that up to 20% of the world's oil trade passes through the Strait of Hormuz, as well as significant volumes of chemical products, fertilizers and other cargo. Due to the confined waters of the Persian Gulf, there are no alternative routes other than this Strait.
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