War-driven fertiliser crisis puts Asia’s food security under pressure

April 23, 2026 (MLN): Emerging Asian markets could face rising cost pressures across agribusiness and food supply chains if a prolonged US–Iran conflict continues to disrupt fertiliser supplies during the planting season, according to Fitch Ratings.

Reduced availability and higher prices of fertilisers are expected to increase production costs, lower application rates, weaken crop yields, and ultimately push food prices higher later in 2026.

Fitch warns that food cost pressures will intensify if fertiliser supply and pricing fail to stabilise soon, particularly as several South and Southeast Asian countries enter key sowing periods.

The Gulf region an important global fertiliser producer due to its natural gas resources remains central to supply, leaving Asia vulnerable if conflict-driven disruptions keep gas prices elevated and shipping routes unstable.

The situation is compounded by export restrictions from major suppliers such as China, which are expected to remain in place at least through mid-year.

This could prolong input cost pressures for farmers and increase the risk of supply shortages for food producers downstream. Prices for nitrogen-based urea have already surged about 50%, rising to roughly $700 per tonne from around $465 before the conflict.

If elevated prices persist, farmers may cut fertiliser usage or reduce planting, raising the likelihood of weaker harvests and further food price increases. Since domestic production is the primary food source across much of emerging Asia, any decline in fertiliser use could significantly impact output.

Countries heavily reliant on food imports such as the Philippines, Bangladesh, Sri Lanka, and especially the Maldives would be more exposed if domestic shortfalls coincide with high global prices and export curbs.

Although near-term food inflation remains moderate due to delayed pass-through from energy costs, risks are mounting.

The World Food Programme estimates that if the conflict extends beyond mid-2026 and oil prices stay above $100 per barrel, an additional 9.1 million people in Asia could fall into acute food insecurity, a 24% increase compared to pre-war levels.

Some countries, including India, are relatively insulated in the short term due to strong fertiliser stockpiles.

However, many others with weaker buffers may see rising farm input costs quickly translate into higher consumer food prices.

Prolonged disruption through the planting cycle could further reduce fertiliser use, intensifying risks to crop yields depending on crop type and nutrient needs.

Research by Yara International highlights the severity of potential impacts, showing that crop yields can drop by up to 43% within a year without nitrogen fertiliser, and by more than 80% over longer periods.

 While not the base case, Fitch notes this underscores how sustained disruption could reshape planting decisions and keep food inflation elevated even after energy markets stabilise.

Governments may face increased fiscal pressure as they attempt to cushion the impact through subsidies for fertilisers and food. Where such support is limited, the burden will fall more heavily on farmers, businesses, and consumers, raising the risk of social unrest.

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