The war in Iran has done more than rattle energy markets. It has exposed an ordinary farm input as a strategic commodity. Urea is a concentrated, easy-to-transport nitrogen fertilizer that increases the yields of many crops, especially staple grains like corn, rice, and wheat. These small white pellets are essentially natural gas in solid form, bound with nitrogen fixed from the atmosphere through the energy-intensive Haber-Bosch process. They are literally a building block of the Green Revolution and critical to global food security.
While the recent U.S.-Iranian ceasefire may have paused or limited hostilities, it already shows signs of breaking apart, with Iran attacking Kuwait and the United Arab Emirates even after the deal, Israel continuing strikes in Lebanon, and President Donald Trump announcing a blockade of the Strait of Hormuz.
A corridor through the strait could be open yet still commercially impaired if the market believes a single boarded or attacked ship could cause confidence to collapse all over again. Shipping does not automatically resume because diplomats announce a pause. Insurers, charterers, and cargo owners must now calculate the war risk premium, the potential for Iranian-imposed tolls that violate international law, and many Western countries’ sanctions laws and the risk of arbitrary enforcement. And this newly announced blockade doesn’t help matters.
As one Emirati official posted on April 9, “the Strait of Hormuz is not open. Access is being restricted, conditioned, and controlled.” Windward CEO Ami Daniel affirmed this reality in a recent Warcast episode, noting that it remains too dangerous for ships to pass the strait, a military re-opening is unlikely to succeed, and the situation likely represents a permanent resetting of global logistics patterns. That reset matters greatly for commodities like fertilizer because large-scale re-route options take years to develop and, in the meantime, physical scarcity worsens. The fragile two-week ceasefire (which may already have collapsed by the time this article is published) fails to solve the underlying structural problem. For agriculture, fertilizer starvation sets the stage for human hunger.
From Market Risk to Agronomic Reality
The initial closure of the Strait of Hormuz and Windward’s reporting of attacks against at least 26 vessels in the region highlight how quickly an energy crisis could become a food crisis. The staple grains that much of humanity depends on are nitrogen-hungry. Achieving maximal yields of maize, rice, and wheat can require the application of hundreds of kilograms of urea per hectare. The Hormuz crisis coincides with spring planting across hundreds of millions of acres of global cropland.
The market’s violent response is a direct result of supply chain fragility crashing into demand. As buyers scrambled for the few remaining tradable cargoes, urea spot prices at the U.S. Gulf Coast approached $700 per metric ton (up over 30 percent from the start of the war), and dealers in major importing markets began limiting sales. The ceasefire did not restore normal prices because prices now incorporate a significant war risk premium and the possibility of renewed disruption. The limiting of sales and price quotes are not signs of panic but are a rational repricing of risk in a system where future supply is no longer guaranteed.
Buyer disorientation is amplified by the unforgiving timing. With the Northern Hemisphere’s planting season underway, its value is tied to narrow agronomic windows. Unlike crude oil, which can be stored for years, delayed urea cargo deliveries incur a serious loss. It must be moved inland by truck, river, and/or rail to be applied within a brief planting window. Otherwise, the yield potential for that crop cycle is permanently degraded. Even with traffic resuming under ceasefire conditions, a disruption lasting several weeks can still reduce usable fertilizer availability for the entire season.
The consequences are bifurcated. In the United States, high fertilizer costs will incentivize a manageable shift from corn to soybeans, with its own cascading effects on animal feed and ethanol. For import-dependent nations in Latin America, South Asia, and Africa, however, the danger is acute. In countries like Bangladesh, India, and Kenya, these price shocks are a direct threat to food supplies and political stability. This means that the farmland of Pakistan alone could conceivably absorb the entire annual production of Qatar Fertilizer Company, owner of the world’s largest single-site urea plant. Between 40 percent and 50 percent of global seaborne urea trade originates from the Middle East, with much of that transiting the Strait of Hormuz. The Gulf-supplied trade is doubly critical because farmers in the developing countries of South Asia, Africa, and Latin America are the largest physical consumers of Gulf-origin nitrogen fertilizer and because these cargoes set the marginal global urea price.
For these countries, the war’s disruption poses a severe food security risk. This stress is why the World Food Program estimates that up to 45 million people could face life-threatening food insecurity if transit stability is not fully restored.
The Industrial Logic of National Food Security
Global reactions reveal a sober understanding of the stakes. India, the world’s largest urea importer, is scrambling to secure new supply deals, knowing a price spike directly threatens its budget and political stability. Brazil, an agricultural superpower, imported its entire urea supply in 2025, approximately 40 percent of which came from the Gulf via the Strait of Hormuz, and must now confront the gap between its ambitions and the reality of its industrial dependence. These are not market adjustments, they are acts of national interest by states now forced to contend with persistent strategic risk in a critical supply chain.
The contrast with the start of the war in Ukraine is stark. That war disrupted a breadbasket, a crisis of agricultural outputs. The Iran war disrupts the industrial inputs that make those breadbaskets possible. Furthermore, while current prices have not yet reached the 2022 peaks — over $1,600 for ammonia and over $1,000 (per metric ton) for urea — the global agricultural system is more fragile. High input costs have eroded farmer savings and tighter credit conditions mean a smaller price shock can now inflict far greater damage. Price comparisons alone mislead: The system’s underlying resilience has been dangerously degraded.
The geopolitical lesson for the United States is clear: Higher fertilizer prices and supply uncertainty increase the likelihood of a cascading sequence of effects such as procurement disruption, reduced crop application, lower yields, and ultimately, food inflation that leads to political instability. This is not a theoretical danger. Research has shown that social unrest caused by precisely this kind of food insecurity exacerbated the 2011 Arab Spring.
Geoeconomics of Grain
A maximalist campaign approach that triggered existential survival responses from Iran is not just an energy problem. Through curtailment of nitrogen fertilizer shipments, it also now risks creating a geopolitical “food vacuum” that America’s strategic competitors will seek to fill. The geoeconomic manipulation window is wide open and is tilted in favor of Iran, Russia, and China.
China and Russia can use their state-controlled enterprises to direct shipments of fertilizer and grain to countries most in need, not out of altruism, but as a calculated act of statecraft. China’s recent imposition of export restrictions on urea sets the stage for selective relaxation to pursue geopolitical goals. Iran itself can also politically condition fertilizer shipments. It could even potentially charge corporate or government-level tolls for Qatari, Saudi, or Emirati-origin fertilizer shipments while mandating price and destination clauses favorable to Global South consumers.
Russia could tie fertilizer shipments to sanctions relief or diplomatic concessions. Moscow used a version of this playbook with grain shipments under the Black Sea Grain Initiative, extracting concessions on its own export logistics as a condition of allowing Ukrainian grain to flow. It could also offer nitrogen fertilizers at preferential terms for countries willing to expand their purchases of Russian oil.
Russian firms could also bundle fertilizer sales — requiring countries to buy a full nutrient package from Russian and Belarusian sources rather than purchasing components separately. This would displace Western suppliers across the entire fertilizer value chain, including potash (the potassium part of fertilizer versus urea’s nitrogen), not just urea.
China could offer fertilizer swaps, allowing recipient countries to pay not in cash but in other commodities (like cobalt), port leases, or telecommunications contracts. A government facing a planting-season emergency and a currency crisis simultaneously would find this offer very difficult to refuse.
The most potent but least likely scenario would be coordinated action by Beijing and Moscow. This is less likely because competition between Chinese and Russian fertilizer producers would hinder coordination. Nonetheless, China could supply urea and di-ammonium phosphate fertilizer while Russia supplies ammonia and potash, creating an integrated Sino-Russian fertilizer supply system that operates entirely outside Western financial and logistics infrastructure. Payments in yuan or rubles, insurance from Chinese underwriters, transport on Russian-flagged vessels. This would build a parallel commodity trading architecture that persists after the crisis ends.
They could also jointly sponsor a “Global South Fertilizer Fund” or similar multilateral mechanism — something that looks like humanitarian aid but functions as a geopolitical recruitment tool. Countries that participate would receive price-stabilized fertilizer allocations: The implicit cost would be alignment with Chinese and Russian geopolitical positions.
Through such coordinated actions, Beijing and Moscow could frame themselves as the heroes of the developing world: Providing stability in a global system disrupted by an unnecessary war started by America. They will offer a clear choice: Accept food and fertilizer on their terms or endure the volatility of a market broken by poorly chosen Western security policies.
Conclusion
The war against Iran has revealed that the food security of a billion or more people depends on a small number of shipping lanes and nitrogen fertilizer plants remaining open. For American policymakers, the challenge is to recognize that national security is not just about military power, but about the industrial inputs that enable the global economy. Wars that disrupt energy flows do not end at the pump: They end in the rising bread prices and political instability.
This requires treating industrial supply chains with the analytical rigor as a military operation. The United States has a vast intelligence apparatus, but it lacks industrial intelligence. Failing to foresee strategic blind spots around physical commodities and industrial chokepoints that enable power projection and normal operating of the economy and agricultural sector. Knowing the production capacity of every fertilizer plant in the Persian Gulf, the location of every bulk carrier vessel, and the fragility of the global food system is not an economic issue for the Department of Agriculture or the Department of State. It is a core intelligence requirement that the National Security Council should have already understood and planned for.
Until Washington understands the value of incorporating geoeconomics into defense planning, these industrial chokepoints will continue to directly erode the U.S. economy and the readiness of its defense industrial base. More importantly, they will undermine the confidence of allies who depend on American power, not just American rhetoric. It will continue to be surprised by crises that do not happen on the battlefield, but occur with a refinery, mine, or chemical plant.
Morgan D. Bazilian is the director of the Payne Institute for Public Policy and a professor at the Colorado School of Mines. Previously, he was lead energy specialist at the World Bank and has over two decades of experience in energy security, natural resources, national security, energy poverty, and international affairs.
Gabriel Collins is the Baker Botts fellow in Energy and Environmental Regulatory Affairs at the Center for Energy Studies at Rice University’s Baker Institute for Public Policy. He leads the Center for Energy Studies Program on Energy & Geopolitics in Eurasia and is an energy-water nexus thrust leader at the Rice WaTER Institute. He also runs The Sinews of Civilization Substack.
Jahara “Franky” Matisek, Ph.D., is a U.S. Air Force command pilot, nonresident research fellow at the U.S. Naval War College and the Payne Institute for Public Policy, and a visiting scholar at Northwestern University. He has published over 150 articles on industrial base issues, strategy, and warfare.
Image: Petty Officer 2nd Class Michael Lehman via Wikimedia Commons
