Reverberating Effects for Fertiliser, Food and Water Security in Times of Conflict

Observer Research Foundation Middle East, as part of the contribution to the UN Water Conference Academic Hub, and in collaboration with the United Nations University Institute for Water, Environment and Health (UNU-INWEH), will be co-hosting today’s session entitled ‘Reverberating Effects for Fertilizer, Food and Water Security in Times of Conflict.’ 

Panelists

• Joseph Glauber, Research Fellow Emeritus, International Food Policy Research Institute (IFPRI) and Former Chief Economist for the US Department of Agriculture
• Mohammed Mahmoud, Middle East Climate and Water Policy Lead at UNU-INWEH (UNU-INWEH) and Chief Executive Officer of the Climate and Water Initiative (CWI)
• Shruti Jain, Associate Fellow, Centre for Development Studies, Observer Research Foundation
• Frederic Schneider, Senior Fellow at the Middle East Council on Global Affairs 

Moderator

• Leigh Mante, Junior Fellow, Climate and Energy, Observer Research Foundation Middle East

Leigh Mante – Moderator

Framing

• Mounting tensions around key maritime chokepoints and trade routes due to the US-Israel-Iran conflict reveal globally entrenched dependencies on singular corridors for food and fertiliser trade. Approximately one-third of global seaborne fertiliser trade transits through the Strait of Hormuz. Prolonged blockages at such key chokepoints may risk food shortages in later planting seasons. Recent attacks on water infrastructure also threaten destabilised water security in the Middle East.
• This conversation highlights the 2026 United Nations Water Conference Interactive Dialogue: Water for Cooperation, underscoring the critical role of water not only as a shared resource, but also as a strategic lever for cooperation, stability, and peace, particularly in times of heightened geopolitical tensions.

Dr Joseph Glauber

Differing responsive capacities to global food supply chain shocks

• Despite high import dependence across multiple food commodities, Gulf states are relatively insulated from short-term shocks, supported by strong oil revenues and existing food stockpiles.
• Concerns arise for countries such as Iraq and Iran, where a prolonged closure of the Strait of Hormuz would require securing alternative routes. These alternatives present significant challenges, including Iran’s reliance on Caspian Sea infrastructure and Iraq’s dependence on costly overland transport options.

Ceasefire implications and spillover effects of a prolonged conflict on regional food security

• Even with the announced two-week ceasefire, commerce is unlikely to return to normal quickly and will instead recover gradually, as risks remain high and continue to drive up transport insurance costs, among other barriers.
• If the disruption extends into the second half of the year, its effects will be felt across South and Southeast Asia, coinciding with key harvest periods for commodities such as second-crop rice.
• Higher fertiliser prices will force farmers to make trade-offs, including in crop selection.
• As energy and fertiliser costs account for a significant share of production expenses, sustained cost increases – without corresponding rises in output prices – will strain profit margins.

Long-term food resilience and lessons from prior conflicts

• Unlike previous crises, such as the Russia-Ukraine war or the 2007–2008 global food price spikes, global food stocks are higher, alleviating pressure on agricultural commodity prices for grains and oilseeds.
• Past disruptions suggest that diversification strategies tend to provide only short-term mitigation. Long-term diversification remains constrained, particularly for commodities such as mineral-based fertilisers and ammonia, which are geographically concentrated. Cost considerations further shape supplier selection across many countries.

Dr Mohammed Mahmoud 

Impacts of the ongoing conflict on water and immediate responses

• Given the region’s heavy reliance on desalination within a water-stressed context, continued risks to desalination infrastructure will force difficult trade-offs – namely, which water-dependent sectors should be prioritised and where production cuts should occur
• Water security vulnerability across Gulf countries remains high, though it varies based on local conditions such as groundwater availability, desalination capacity, infrastructure location, and exposure to contamination on land and at sea

Future of water management and distribution strategies in the region

• Attacks on key water infrastructure such as desalination plants will fundamentally reshape the equation of how national water demands are managed.
• Traditionally, Gulf states’ water management strategies have focused on addressing drought and optimising the use of scarce water resources to support socioeconomic growth, while sustaining energy production and other industrial activities.
• In recent years, acute and short-term disruptions to water infrastructure, particularly in Oman and the UAE, have largely stemmed from extreme weather events. Current military attacks represent a new frontier, requiring additional strategic considerations.
• Gulf countries are likely to reprioritise their approaches to water security. Although each faces distinct challenges – Kuwait with ongoing groundwater remediation constraints, Bahrain and Oman with exposure to sea-level rise, and the UAE and Saudi Arabia with the pressures of large and growing populations – a common thread is the need to account for military dimensions.
• The upcoming UAE–Senegal co-hosted water conference later this year presents an opportunity for regional collaboration. However, the emphasis on water sovereignty among Gulf countries is likely to remain a key barrier to progress. Likewise, revisiting the GCC Unified Water Strategy poses a range of technical challenges that could hinder implementation.

Threats of potential oil spill leakages on future water desalination efforts

• The extent to which oil spills impair desalination plants’ ability to produce potable water depends on the scale of the spill, the degree of contamination, and the type of pollutants involved (e.g., heavy metals and other toxic substances).
• The non-static nature of Gulf waters, driven by both surface and deep-water currents, can provide some dilution that may mitigate acute impacts. However, proximity to the spill remains a decisive factor in determining the extent of this benefit.
• Groundwater, often considered a backup to desalination, is highly vulnerable to contamination if spills occur on land and seep into the soil. This risk was evident during the Gulf War, with consequences in Kuwait still observed today.

Dr Frederic Schneider

Impacts of the ongoing conflict on fertiliser and food and immediate responses

• The GCC is a dual-risk hub as a major food importer and critical energy and fertiliser exporter. Natural gas and sulfur from the region are essential global fertiliser feedstocks, while damage to infrastructure like the Qatar Fertiliser Company requires significant reparation time, further constraining export capacity.
• Some countries are better equipped to respond to shocks. Oman and Saudi Arabia have access to alternative routes through the Arabian Sea and the Red Sea; the UAE has large strategic food reserves; and Qatar has experience managing previous blockades.

Vulnerability of Global Supply Chains

• India is highly exposed ahead of the Kharif planting season due to dependence on Gulf feedstocks such as natural gas, sulfur, and phosphate for domestic and imported fertilisers, reducing year-end harvest yield. These risks are further exacerbated by essential household fuel (LPG) shortages.
• Brazil imports 85 percent of its fertiliser, half of which transits through the Strait of Hormuz. Disruptions threaten the upcoming soybean season, creating ripple effects across global livestock feed supply chains.
• The MENA Region also faces supply risks. Egypt’s weak fiscal position makes it unable to absorb price surges, while conflict-ridden areas face intensified humanitarian impacts.
• Substituting nitrogen-intense urea is challenging; with alternatives requiring higher volumes and often resulting in lower crop yields.

How the current crisis differs from the Russia-Ukraine shock

• The ongoing crisis does not yet reflect Ukraine price spike levels.
• Europe is shielded by significant stockpiles built up before the January 2026 carbon levy, while the Global South faces severe exposure, with rising fertiliser and transport costs expected to trigger a surge in consumer food prices over the next 6-12 months.

Limited diversification pathways for fertilisers

• Russia and Belarus are major producers of ammonia and urea, while China houses large stockpiles. Despite sanction exemptions for fertiliser exports from Russia, all three have enacted export restrictions to prioritise domestic demand. Additionally, drone strikes on Russian plants have further hindered production capacity to fill short-term gaps.
• Morocco holds vast phosphate reserves, but processing requires sulfur which is largely sourced from the Gulf, thus creating complications for substitution.
• Transitioning from natural gas to renewable-based “green” ammonia remains a long-term aspiration. Current project pipelines are concentrated in the GCC, leaving them exposed to the same regional trade risks as traditional exports. Green ammonia is not yet cost-competitive for production to accelerate in Global South countries.

Prospects for food and water cooperation to build resilience

• Building redundancy and diversification is key. Emulating strategies from the hydrocarbon sector may provide immediate shock buffers. This includes 1) developing an international stockpile system modeled after the IEA oil system; 2) establishing offshore reserves for critical fertilisers; 3) developing shared GCC infrastructure, logistics corridors, and joint reserves to absorb regional shocks.

Shruti Jain

Impacts of the ongoing conflict on the Global South and immediate responses

• The ongoing conflict exposes global dependencies on few suppliers and trade corridors, translating to higher logistics costs, insurance premiums, and fertiliser prices.
• While high-income GCC states can leverage financial capacity and storage reserves to manage shocks, lower-income countries face “hidden costs” like food inflation, higher food transportation costs, delayed remittances, and reduced access to water and sanitation.
• Although the Indian government has assured buffer stocks for the next few quarters, a prolonged conflict will risk farmer tradeoffs.

Impacts on smallholder farmers and households in India

• Smallholder farmers in India already work with low capital and within limited margins. The timing of fertiliser use is very important, given the upcoming Kharif planting season, and a 15-day delay could result in lower yields. High input costs may force farmers to reduce fertiliser use or transition to lower-value crops, resulting in lower yields and rising household food bills.
• Commercial LPG shortages are affecting restaurants and urban food access, sparking an urban-to-rural migration shift with the potential to threaten productivity of small and medium-sized enterprises and long-term GDP contraction.

Government responses to mitigate impacts

• Subsidies: The government has capped urea prices and implemented statutory pricing for DAP/phosphatic fertilisers. While subsidies help protect farmers from high costs, they also intensify national fiscal pressures.
• Trade Diversification: The government is facilitating long-term supply agreements with Southeast Asian partners while increasing imports from Russia and Morocco.
• Market Regulation: The government has invoked the Essential Commodities Act to prevent hoarding and black markets from emerging across federal states.