UK farmers face rising costs as Iran war inflates expenses, leaving finances unbalanced

The modest green oilseed‑rape seedlings sway under the gusty spring breezes. Planted in August of the previous year, the stand is now rising and should be ready for cut in July, when it can be processed into edible oil or fuel.

The tranquil 230‑hectare (568‑acre) arable holding owned by James Cox on the fringe of the Cotswolds in Gloucestershire lies far from the turmoil in the Middle East. Yet the fallout from US and Israeli attacks on Iran – and Tehran’s response – is already beginning to affect Cox and other British food growers.

The cost of essential farm inputs such as diesel and fertiliser has surged, just as their demand will climb in the coming weeks with the spring sowing season under way and tractors working harder.

Cox has already spread a first application of fertiliser on his oilseed rape, with a second dose due in a few weeks, and he will shortly sow his spring barley.

He counts himself among the fortunate – all the fertiliser required for this year has arrived and his fuel tanks are full of diesel for his machinery and heating oil that he and many countryside households depend on for warmth, cooking and hot water. He cannot, however, predict the price he will pay when he next needs to replenish his stores.

“Not everyone will have secured all the fertiliser they need, because of their cash flow and low grain prices,” Cox says.

Analysts estimate that roughly one‑third of the world’s seaborne fertiliser trade passes through the Strait of Hormuz, according to the UN Conference on Trade and Development (UNCTAD) using 2025 data from the agency Kpler. About one‑fifth of seaborne crude oil and gas also moves through the key shipping lane off Iran’s southern coast.

The narrow conduit has effectively been shut since the conflict began, stopping the flow of fossil fuels as well as ammonia, nitrogen and sulphur – key components of many synthetic fertilisers.

A prolonged blockage could disturb output at the globe’s largest fertiliser plants, many of which sit in the Gulf. In 2024, around 16 million tonnes of fertiliser were shipped from the region, UNCTAD reports.

Higher energy costs for production are already driving fertiliser prices upward. Egyptian urea, a price reference, has risen by more than 45 %, reaching $700 (£525) a tonne, up from about $484 in late February.

Approximately half of global food output relies on synthetic nitrogen, and yields would drop without fertiliser – Britain’s growers are estimated to use about 1 million tonnes of synthetic nitrogen each year for food crops and animal feed.

Any shortfall is likely to lift the cost of everyday staples such as bread, pasta and potatoes, and food‑price inflation is expected to speed up toward the end of the year, according to the data.