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If you are reading commodity price movements as evidence that the closure of the Strait of Hormuz has been absorbed without consequence, you are reading the right data for the wrong time horizon. Credit: Mauricio Ramos/IPSROME, April 17 (IPS) - The headlines are wrong about food prices — but right to be afraid, very afraid. Walk into a supermarket in Chicago, Berlin, or Mumbai today, and you will not find the shelves stripped bare or the prices dramatically higher than last month. Despite weeks of alarming headlines about commodity markets, food inflation in most major economies has risen only marginally — a tenth or two-tenths of a percentage point between February and March of this year. In the United States, food inflation moved from roughly 2.9 percent to 3.1 percent. In Germany, from 0.8 to 0.9. In India, from 7.8 to 8.0.
This is not a crisis at the checkout counter. Not yet.
But here is what the headlines are getting wrong, and what they are getting terrifyingly right at the same time: the stability you see today is real, and it is also beside the point. What is coming — if the world does not act quickly and the cease fire does not continue— is a food price shock of a different order, arriving not in March but in the harvests of late 2026 and the markets of 2027.
To understand why, you first have to understand what commodity price indexes actually measure, and what they do not. The FAO Food Price Index — which did rise slightly in March, driven largely by vegetable oils and sugar amid higher crude oil costs — tracks the international price of raw agricultural commodities: wheat, maize, rice, oilseeds, dairy.
It does not track what you pay for a baguette or a box of pasta. By the time wheat becomes bread, the grain itself represents only 10 to 15 percent of the final retail price. The rest is energy, labor, processing, packaging, logistics, and retail margins.
This cost structure is precisely why grocery bills do not lurch upward the moment commodity markets move. It is also why the current calm is not a reliable indicator of future stability specially because of the significant share of energy costs.
Short-term stability is not medium or long-term security. The time between a fertilizer shock and a harvest failure is measured in months. The time between a harvest failure and a food price surge is measured in months more. We are already inside that window
The Strait carries roughly 35% of crude oil exports — but its disruption reaches agrifood systems through a less obvious channel, logistics and energy costs for food processing. In addition, the Strait carries 20% of natural gas which can’t be replaced by any other source, and which is essential for nitrogen fertilizer ( specifically urea), 20-30% of fertilizers export depending on the specific type and about 50% of Sulfur exports a key input to produce phosphate fertilizer. All this is still not showing up in this month’s price indexes.
According to FAO analysis, the Strait of Hormuz closure has choked off 30 to 35 percent of global urea trade. Urea prices have already jumped between 40 and 60 percent. The feedstock that makes nitrogen fertilizer possible — natural gas — has risen 70 to 90 percent in price. Brent crude is up 60 percent just before the cease of fire.
These are not abstract figures. They are the inputs that farmers in the United States, Europe, South Asia, and across the Northern Hemisphere are confronting right now, as planting season either begins or approaches.
The decision they face is not a comfortable one: pay double for fertilizer when commodity prices are already low, and hope prices recover, or cut application rates and accept lower yields. Some will shift toward nitrogen-fixing crops like soybeans. Others will pivot toward crops destined for biofuel production, reducing the food supply further still.
The consequences of those decisions will not appear on store shelves until the harvest comes in, or the markets decides to incorporate them in future prices. When they do, the combination of constrained yields, elevated energy costs running through every link of the supply chain, and ongoing trade disruptions will drive commodity prices higher, and food prices even higher because of the additional energy cost increases — not by a tenth of a point per month, but meaningfully, in ways that will be felt most acutely by the households that can least afford it.
Short-term stability is not medium or long-term security. The time between a fertilizer shock and a harvest failure is measured in months. The time between a harvest failure and a food price surge is measured in months more. We are already inside that window.
The world’s response cannot wait for the price indexes to confirm what the agronomic and economic data already make clear.
Governments, development institutions, and the private sector must act now on three fronts: ensuring fertilizer access for smallholder farmers and input and food import-dependent nations before their planting decisions become irreversible; protecting and diversifying trade routes so that disruption in one chokepoint does not become a global supply crisis; avoid export restrictions of fertilizers and energy products and pursuing with urgency the diplomatic solutions that remain, for now, within reach.
The supermarket and retail store shelves are stocked. The silos are full. And the window to keep them that way is closing.
Keeping the Strait of Hormuz open is therefore not just about preventing food inflation — it is about averting a broader surge in overall inflation that would directly undermine economic growth, while also shielding every other sector dependent on the energy and input prices that flow through this strategic chokepoint.
© Inter Press Service (20260417120633) — All Rights Reserved. Original source: Inter Press Service
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