War in Iran triggers severe fuel and fertiliser shortages threatening Southeast Asian rice production

Spiking fuel and fertiliser costs from the Iran war threaten a 10% drop in rice output across Southeast Asia. Learn how the 2026 food supply is at risk.

By: AXL Media

Published: Apr 11, 2026, 5:35 AM EDT

Source: Information for this report was sourced from The Straits Times

Supply Chain Paralyzed by Middle Eastern Conflict

The ongoing war in Iran has pushed Southeast Asia’s agricultural sector toward a critical breaking point as the near-closure of the Strait of Hormuz chokes global trade. Harvest-ready paddy fields currently sit idle across the region because the skyrocketing costs of diesel and fertiliser have made it financially unviable for many smallholders to operate machinery or irrigation pumps. According to Patrick Davenport, director of BRM Agro in Cambodia, the rural population is facing a severe crisis as the vital delivery routes for energy and crop nutrients remain largely blocked despite a temporary ceasefire.

Logistical Chokepoints and the Strait of Hormuz

Global food security is increasingly tethered to the stability of the Strait of Hormuz, which serves as a primary artery for the energy and chemical supplies essential to Asian agriculture. Maximo Torero, chief economist at the United Nations’ Food and Agriculture Organization, noted that while existing stockpiles currently buffer consumers, a continued blockage of the strait would affect food availability by the second half of 2026. The scarcity has caused oil prices to spike, leaving tens of millions of farmers without the affordable fuel needed to run tractors and rice planters during the pivotal transition between dry and wet seasons.

Diminishing Margins and Predicted Production Deficits

The economic pressure on growers is intensifying as input costs double or triple while market prices for rice remain suppressed by ample global inventories. In the Philippines, the world’s leading rice importer, national output could plummet by 10 percent in 2026, representing a loss of approximately 2 million tonnes of grain. Raul Montemayor of the Federation of Free Farmers Cooperatives indicated that this reduction will likely be felt during the autumn harvest. Similarly, Thailand’s dry-season crop is projected to fall by 19 percent compared to last year as farmers choose to leave crops in the ground rather than absorb the high costs of collection.