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The current conflict in the Middle East, and its effects on shipping and access to the Strait of Hormuz, is disrupting global fertilizer markets, raising prices and tightening supply across global agriculture. About 25%-30% of the world’s nitrogen fertilizer exports pass through the Strait of Hormuz and vessel traffic through the Strait is now reduced to a trickle, with further disruptions across the Gulf, North Africa, and the Eastern Mediterranean. Within 48 hours of the first strike on Iran, North African urea prices surged by nearly 20% and EU natural gas jumped by ~45%, underscoring the region’s critical role in global fertilizer flows. The shock is already both deeper and more complex than disruptions seen in the Strait and broader region following the 12-day Israel-Iran war in 2025.
The key uncertainty now is whether the impact remains transitory or becomes structural – which will hinge on the duration and potential escalation of the conflict. A rapid de‑escalation would contain the damage to short‑term volatility. But there is the risk of more lasting tightening: A ~30% rise in ammonia prices or ~20% rise in sulphur prices would push phosphate producers into severe margin pressure, while a persistent 20%-30% premium of global urea over Chinese prices could further delay Chinese exports. At the very least, a war‑risk premium seems inevitable.
Australia’s key commodities highlights and economic influences for this month. The full report covers the developments to watch in the upcoming weeks.
Here are the main highlights for some of New Zealand’s key commodities this month. The full report covers the developments to watch in the upcoming weeks.
World Farming Agriculture and Commodity news -02 March 2026
World food prices rose in February after falling for five straight months, as higher cereal, meat and most vegetable oil prices outweighed declines in cheese and sugar, Reuters reported, citing the United Nations' Food and Agriculture Organization on Friday.
The FAO Food Price Index, which tracks monthly changes in a basket of internationally traded food commodities, averaged 125.3 points in February, up from a revised 124.2 in January.
The index was still 1% below its value a year earlier and nearly 22% below its March 2022 peak, reached after the start of the war in Ukraine.
Average cereal prices increased 1.1% from the previous month, with wheat prices rising 1.8% due to weather risks in Europe and the United States as well as continuing logistical disruptions within the Russian Federation and the wider Black Sea region. They were still 3.5% below their level of a year earlier.
Rice prices edged up 0.4%, supported by sustained demand for basmati and Japonica varieties.
Vegetable oil prices climbed 3.3%, reaching their highest level since June 2022. Palm oil prices increased due to strong global demand and lower output in Southeast Asia, while soyoil prices rose on expected policy support for biofuel in the U.S.
Meat prices rose 0.8% from January, led by record prices for sheep meat and stronger demand for beef in the U.S. and China.
Dairy prices fell 1.2%, extending a months-long decline, mainly due to lower cheese prices in the European Union. However, skimmed and whole milk powder and butter prices increased on strong demand amid tight supply in key exporters.
Sugar prices dropped 4.1% to their lowest since October 2020, reflecting expectations of ample global supply, including record output in the United States.
In a separate report, the FAO slightly raised its 2025 global cereal production forecast to a record 3.029 billion metric tons, reflecting minor adjustments, mainly to maize and rice estimates. It would be 5.6% higher year-on-year.
World cereal stocks by the close of the 2026 season are also set to rise, with the global stocks-to-use ratio seen at a comfortable 31.9%.
Britain has begun targeted bird flu vaccine trials in turkeys, the government said on Thursday, marking a shift in its approach to controlling the disease that has ravaged flocks and pushed some countries to adopt the technique to help reduce losses, reported Reuters.
The spread of highly pathogenic avian influenza, commonly called bird flu, is a concern for governments and the poultry industry due to the devastation it can cause to flocks, its impact on food prices and a risk of a new pandemic.
Concerns over vaccination masking the spread of the virus and jeopardising exports have led major poultry producers worldwide to largely resist the strategy.
The UK trials, expected to span 24 weeks, aim to assess the effectiveness of authorized vaccines in field conditions and evaluate how surveillance mechanisms can protect trade, the Department for Environment, Food and Rural Affairs (DEFRA) said in a statement.
Bird flu outbreaks have cost Britain's government and the poultry industry up to 174 million pounds ($232 million) per year, DEFRA said.
Turkeys were selected for the trials due to their high susceptibility to the virus, with outbreaks often causing significant mortality rates.
France has been vaccinating farm ducks against bird flu since 2023, making it the first major poultry exporter to do so nationwide. It has credited the policy with curbing the disease.
The Netherlands and the United States are also running vaccine trials, with the US assessing how any use of vaccination could affect poultry exports.
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