“Harvest-ready rice fields are lying idle and farmers are deciding whether to skip planting for the coming season, as spiking fuel and fertilizer costs from the war in the Middle East hit one of the world’s biggest rice-growing regions,” reports Bloomberg News:
Across Southeast Asia, tens of millions of smallholders are struggling to find affordable crop nutrients as well as the diesel needed to run tractors, irrigation pumps and rice planters. In Thailand, some farmers are leaving the crop in the ground as it’s too expensive to harvest.
The scarcity of supplies underscores how the six-week war in Iran has upended global trade and raised concerns around food shortages. As well as driving oil prices higher, the near-closure of the Strait of Hormuz – which remains largely blocked despite a temporary ceasefire – has choked a vital route for fertilizer and fuel deliveries, with Asia particularly affected.
“There’s a lot of panicked farmers,” said Patrick Davenport, director and co-founder of BRM Agro, an integrated rice farmer and miller in Cambodia, where roughly three-quarters of the population lives in rural areas. “Most are involved in agriculture – and they’re all hurting,” he said.
Rice is a staple for more than half of the world’s population, as well as a livelihood for rural communities across a region where agriculture still accounts for a large share of economic activity. Farmers [are] struggling with input costs that have doubled or even tripled.
Thailand imports almost all of the fertilizer it uses. 35-40% comes from the Persian Gulf, where fertilizer shipments have largely ceased due to the near-closure of the Strait of Hormuz. Ships have to pass from the Persian Gulf through the Strait of Hormuz into the Indian Ocean to reach Thailand.
The Iran War hasn’t harmed the U.S. all that much, because we produce most of the oil we consume. So gasoline purchasers’ loss is gasoline producers gain, with higher gas prices benefiting gas-producing states like New Mexico, Texas, and North Dakota.
But that’s not true of Asia, where all but two countries import most of the oil they use. Higher gas prices leave those countries poorer and more financially stressed.
The Iran War also harmed retail businesses and the tourist industry in Egypt, which is a net oil importer.
