Nations Race to Secure Enough Fertilizer and Prevent Food Crisis

Governments are rushing to secure supplies of critical crop nutrients ahead of spring planting, as the Middle East war chokes off the flow of commodities and amplifies fears of a global food crisis.

Fertilizers exemplify the tight link between energy and food prices, underpinning harvests worldwide. The Middle East is a vital supplier, rich in both mineral reserves and the gas needed to produce nutrients for staples like corn, wheat and rice. With the Strait of Hormuz effectively shut, shipments have ground to a halt as Iran, the US and Israel continue to exchange strikes on energy infrastructure. Humayun Tai, McKinsey Global Energy & Materials Practice Senior Partner & Leader  joins to discuss. China has indicated it will halt exports of sulfuric acid from May, hitting metals and fertilizer industries already strained by raw material bottlenecks resulting from the Iran war.

Some sulfuric acid producers in the country recently received notifications about the change, and one large buyer has been told about it by their Chinese supplier, according to people familiar with the matter, who asked not to be identified discussing confidential information. The ban will cover sulfuric acid that’s a by-product of copper and zinc smelting in China.

Sulfuric acid prices have been rising since the start of the Iran conflict, as the effective closure of the Strait of Hormuz blocks sulfur shipments from the Middle East, where it’s a product of oil and gas refining. The region produces one third of the world’s sulfur, a raw material used to make sulfuric acid that’s essential for some copper extraction and phosphate fertilizers.

China’s move to conserve sulfuric acid supplies during the peak crop-planting season will put further pressure on the market. That squeeze will hit the copper-mining industries in key producers such as Chile, the Democratic Republic of Congo and Zambia.

Pricing agency Argus Media first reported the Chinese ban on Thursday, saying the restriction could last throughout 2026.

China’s Ministry of Commerce didn’t immediately respond to a request for comment.  India’s production of urea — a widely used nitrogen fertilizer — will return to normal levels from Friday, as some idled plants restart operations following an improvement in natural gas supplies, according to people familiar with the matter.

Some manufacturers, including top producer Indian Farmers Fertiliser Cooperative Ltd., had shut a few of their facilities or undertaken routine maintenance as supplies of gas, a key feedstock, fell after disruptions linked to the Middle East conflict.

As a result, India’s urea production fell by about 800,000 tons in March, from a normal monthly level of more than 2.6 million tons, said one of the people, who asked not to be identified as they are not authorized to speak to the media. India is one of the largest consumers and the biggest importer of the crop nutrient.

A fertilizer ministry spokesperson didn’t immediately respond to an email seeking comment.

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