Supply Shock From Fertiliser Stress to Food Inflation

Global fertiliser price surges due to Middle East conflict are squeezing farm margins and forcing a shift from grains to oilseeds. This supply shock is expected to lower crop production and drive food inflation with a lag in 2026-27.

Key Takeaways

• 1.Rising fertiliser and fuel prices are expected to reduce input application rates and crop yields, eventually leading to higher food inflation.
• 2.Higher fertiliser costs are triggering a global shift from fertiliser-intensive grains (corn, rice) toward oilseeds and pulses.
• 3.The Middle East conflict is causing a delayed impact on grain prices compared to the Russia-Ukraine conflict, as the Middle East is a key fertiliser producer rather than a major grain producer.

Table of Contents

• Authors
• Contact
• Supply shock: from fertiliser stress to food inflation
• Fertiliser supply disruptions trigger demand rationing
• How countries are dealing with fertiliser supply disruptions
• At a country level
• Food prices are yet to reflect fertiliser supply disruptions
• Important Notice

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