Yara Warns Iran Conflict Threatens Global Food Supply

The head of Yara, one of the world's largest fertiliser companies, has warned that the conflict involving Iran could cut crop yields and drive up food prices globally. The warning centres on fertiliser supply chains, which are sensitive to disruptions in the Middle East, a key transit and production corridor for energy-intensive inputs like natural gas, the main raw material for nitrogen fertilisers. When natural gas becomes scarce or expensive, nitrogen fertiliser output falls, farmers use less of it, and crop yields drop. Lower yields mean less food supply hitting markets at the same time as prices rise. Yara has not specified which supply routes or volumes are directly at risk, but the scale of the concern is significant: billions of meals, the company says, could be affected. Fertiliser prices are already prone to volatility following the disruptions caused by the Russia-Ukraine war. Investors and food companies should watch natural gas prices and Middle East shipping conditions closely as the situation develops.