The War in Iran: One More Reason to Invest in Soil Health

One of the far-reaching global consequences of the U.S./Israeli war on Iran is an interruption in the world market for fossil fuel-based fertilizers that conventional farming systems depend on.

The Strait of Hormuz—which has been essentially cut off to freight transportation due to security concerns—has become a choke point not only for crude oil and natural gas but also for the urea and ammonia needed to produce synthetic fertilizers. It has been widely reported¹^,²³^,3 that nearly 49% of global urea exports and about 30% of global ammonia exports from countries such as Qatar, Egypt, Iran, Oman and Saudi Arabia move through the Strait annually. Additionally, Iran is home to some of the world’s largest natural gas reserves, a critical element of ammonia production. And finally, the Middle East provides about one quarter of the world’s supply of sulfur, an ingredient in phosphate fertilizers.

Impacts on Farmers and Food Systems

The timing couldn’t be worse for many American farmers who are starting spring planting. Researchers at North Dakota State University report that fertilizer prices spiked 23% in the first three weeks of the war, combined with sudden decreases in availability. Fertilizer sales operate in a global marketplace, so even when limited supplies directly impact some countries, the effect on prices and availability ripples throughout the entire industry. The North Dakota economists note that “fertilizer prices often continue to rise for several months after the initial disruption, particularly when supply chains remain constrained.”

Some farmers may try to stretch their fertilizer budget, risking yield losses. Others may pivot to crops that require less fertilizer. And for some who have been hanging on year after year, this may be the tipping point to make the painful decision to sell the family farm.

As crop production costs rise and yields drop, the impact will trickle down to consumers in the form of higher grocery prices. As always, small producers and economically vulnerable communities will be disproportionately impacted. A recent story in The Guardian lays out the global implications in a column titled “Energy shock talk grabs headlines but the Iran war is also driving the world towards a food crisis.”

This is not the first time in recent years that a shock like this has hit the agriculture industry. In the fall of 2023, the U.S. Economic Research Service reported on the one-two punch caused by the Covid-19 pandemic followed by Russia’s invasion of Ukraine in 2022. That war caused a short-term transportation interruption in the Black Sea region, briefly driving up fertilizer prices by 50%, and longer-term issues stemming from war-related trade restrictions. At the time, Russia and Belarus exported almost 20% of the world’s fertilizers.

The Trump administration and members of Congress have floated various proposals in response to this crisis including military escorts for freighters, shoring up domestic fertilizer production infrastructure, a bill requiring transparent reporting on fertilizer pricing, and financial bailouts for farmers.

Policymakers have another option: Support farmers in reducing their reliance on synthetic fertilizer by making alternatives more economical and accessible.

Soil Health as a Long-Term Solution

*NRCS Principles of Soil Health* – *Credit: USDA-NRCS*

For many years, the USDA Natural Resources Conservation Service (NRCS) has been a leader in supporting farmers with building soil health, which they define as “the continued capacity of soil to function as a vital living ecosystem that sustains plants, animals, and humans.” NRCS describes four principles of soil health that can be realized by using practices such as composting and mulching, planting cover crops, reduced tillage, conservation plantings, diverse rotations, prescribed grazing, and others.

Adopting these practices is not simply a matter of replacing fossil fuel-based fertilizers with a different input—the transition requires new products and input suppliers, equipment and knowledge, as well as changes to existing policies and regulations. Policymakers have a key role to play here by supporting research and development, incentives and technical assistance, and streamlining regulations to reward farmers for adopting multi-benefit practices.

Recognizing a federal role for assisting farmers with continually improving on-farm environmental stewardship, the NRCS provides grants for agricultural conservation practices through their Environmental Quality Incentives Program and Conservation Stewardship Program, both of which have historically large amounts of funding available over the next few years. With some of this increased funding, NRCS also recently launched a Regenerative Agriculture pilot program that has a focus on grants for soil health practices.

The state of California and several others around the country have also created healthy soils programs with similar goals (read about some of these efforts on CDFA’s website and on the National Healthy Soils Policy Network website). California’s Alternative Manure Management Program (AMMP) provides grants to dairy farmers to produce compost from their manure as an organic fertilizer. At CalCAN, we are champions of a federal bill (the COWS Act), sponsored by Rep. Jim Costa, to replicate this program at the USDA.

Governments can also make it easier for farmers to adopt soil building techniques by minimizing regulatory red tape. For example, California’s Irrigated Lands Regulatory Program (ILRP), which attempts to reduce nitrate contamination in groundwater caused by excess fertilizer, could encourage the use of alternatives to synthetic fertilizers such as compost and cover crops. To scale up the production of much-needed compost from dairy operations, the state could create an efficient and effective process for approving new on-farm composting projects on livestock operations, as proposed in the CalCAN-sponsored bill AB 2100 (Connolly).

The co-benefits that come with a focus on soil health are many, including:

Decreased dependence on synthetic fertilizers and the inherent instability in availability and price caused by global geopolitical instability like what we are seeing now with the war on Iran
Improved farm profitability
Cleaner air and water that improves the health of ecosystems and human communities, particularly those in rural communities
Increased soil water penetration and retention that can decrease demands for on-farm water and make farms more resilient to droughts and floods
Greenhouse gas reductions and soil carbon sequestration
Increased on-farm biodiversity, above and below ground

Individual farmers are implementing soil health innovations on their farms with a lot of success. Making a systemwide transition so this becomes the new business-as-usual approach to growing healthy, affordable food will require a commitment from governments to finance it with incentives and assure that the regulatory indicators support new practices rather than limit them. Perhaps the fertilizer crisis being catalyzed by the war in Iran will create the conditions for more farmers to consider changes in their farming systems and more governments to give them the support to take the risk.