Question.
Critically examine how disruptions in the Strait of Hormuz affect fertiliser supply, cropping choices, and food prices, especially in the Global South. Suggest policy measures to mitigate the crisis.
GS Paper III – Economy (Food Security)
Answer.
The Strait of Hormuz is one of the world’s most critical energy and trade routes, connecting the Persian Gulf to the west with the Arabian Sea to the east.
It carries ~20% of global LNG trade and a significant share of oil and fertilizer feedstock.
Any disruption in this narrow chokepoint creates a chain reaction from energy → fertiliser → agriculture → food prices, especially affecting the Global South.
The Global South refers to a grouping of developing, less developed, or underdeveloped nations, primarily located in Africa, Latin America, and Asia (excluding Israel, Japan, and South Korea), that share common histories of colonialism and socioeconomic challenges.
Impact on Fertiliser Supply
(a) Disruption of Feedstock (Gas & Chemicals)
Fertilisers like urea and ammonia depend on natural gas.
Around 20% of global LNG trade passes through Hormuz.
Supply disruption raises gas prices → fertiliser production becomes costly.
Due to the recent ongoing war between Iran and the USA, and the closure of the Strait of Hormuz, the price of nitrogen fertilisers has risen by ~35%.
(b) India’s High Dependence
~40% of India’s fertiliser imports come from the Gulf.
Import dependence:
Urea: 20–25%
DAP: 50–60%
Potash: ~100%
Fertiliser production also depends on LNG:
>50% LNG imports via Hormuz
~69% LNG from West Asia
As a result, Supply shocks directly hit fertiliser availability in India.
Impact on Cropping Choices:
The following are impacts on cropping choices:
(a) Shift to Low-Input Crops
Farmers may reduce the use of expensive fertilisers and also be forced to shift from:
High-input crops (rice, wheat)
→ to low-input crops (millets, pulses)
(b) Reduction in Sown Area
High fertiliser prices discourage sowing. Farmers may leave land fallow or reduce acreage.
(c) Yield Decline
Lower fertiliser use → decline in productivity
Particularly severe in developing countries.
This creates a “hidden agricultural crisis”.
Impact on Food Prices
(a) Cost-Push Inflation
Fertiliser cost ↑ → production cost ↑ → food prices ↑
(b) Global Supply Shock
Lower production → reduced supply → higher global prices
(c) Impact on the Global South
Countries in Africa and South Asia are highly import-dependent and have low subsidy capacity. As per UN estimates, disruptions may push millions into food insecurity.
Wider Economic Linkages
(a) Energy–Food Nexus
Hormuz disruption affects:
Oil (transport cost)
Gas (fertiliser)
LPG (household consumption)
Example:
India imports:
~35–40% crude via Hormuz
~60% LPG (90% via Hormuz)
(b) Supply Chain Delays
Shipping disruption → higher freight & insurance cost
Longer routes → delayed fertiliser supply
Critical Evaluation
The crisis shows the structural vulnerability of the Global South:
- High import dependence
- Low diversification
- Limited storage capacity
- It also highlights the overdependence on fossil-fuel-based fertiliser systems.
Policy Measures to Mitigate Crisis:
Here are short, medium, and long-term mitigation strategies:
(A) Short-Term Measures
- Strategic fertiliser reserves
- Diversification of suppliers (Russia, Africa, Latin America)
- Subsidy support to farmers
- Priority allocation of gas to the fertiliser sector
(B) Medium-Term Measures
- Promote nano-urea and organic fertilisers
- Improve fertiliser use efficiency (soil health cards)
- Expand domestic fertiliser production
(C) Long-Term Structural Reforms
- Shift to green ammonia (renewable-based fertiliser)
- Strengthen regional cooperation (BRICS, Global South alliances)
- Develop resilient supply chains and storage infrastructure
Disruptions in the Strait of Hormuz demonstrate how geopolitical shocks can quickly transform into food crises. The fertiliser–food–energy linkage makes the Global South particularly vulnerable.
Going forward, countries like India must move towards diversification, self-reliance, and sustainable fertiliser systems, while building resilient and shock-proof agricultural policies to ensure long-term food security.
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