By STACY LIBERATORE, US SCIENCE & TECHNOLOGY EDITOR
Published: 17:23 BST, 23 August 2026 | Updated: 17:23 BST, 23 August 2026
Americans could soon be hit by a grocery-price surge as two global threats collide to squeeze the world’s food supply.
A new analysis from JPMorgan has warned that global food costs could climb five percent during the first half of 2027 as fertilizer shortages converge with a potentially powerful El Niño.
The first threat is unfolding in the Persian Gulf, which supplies more than 36 percent of the urea, a high-nitrogen agricultural fertilizer, imported worldwide.
Dr Sarah Kapnick, Global Head of Climate Advisory for JPMorgan, said the Iran conflict has slowed fertilizer production, and disruption through the Strait of Hormuz has restricted exports and driven prices higher.
Those shortages could begin hurting harvests within months, starting with South American corn before affecting wheat in the US and other major producers and rice crops across Asia, Kapnick warned,
At the same time, El Niño could disrupt rainfall and temperatures around the world, exposing important farming regions to drought, flooding and extreme heat.
Tropical producers face the greatest danger, particularly Brazil and India, where heavy reliance on Persian Gulf fertilizer overlaps with areas historically vulnerable to El Niño crop losses.
Although the US may escape the worst direct effects, Americans could still pay more for food as global harvests shrink and the cost of crops, fertilizer and imported staples rises.
A new analysis from JPMorgan has warned that global food costs could climb five percent during the first half of 2027 as fertilizer shortages converge with a potentially powerful El Niño
Kapnick described the overlapping threats as an example of climate acting as a ‘threat multiplier.'
'I didn’t expect so many examples of “climate as a threat multiplier” to emerge so quickly,’ she wrote in the report.
‘We are seeing some of those vulnerabilities at play today, as emerging supply chain and business continuity threats are growing, amplified by natural gas price volatility and supply chain disruptions from the Iran conflict, a brewing El Niño and existing drought conditions.’
Nitrogen is the most widely consumed fertilizer by mass and plays a critical role in producing three of the world’s most important foods.
