Fuel and fertiliser risks — why Middle East conflict threatens SA’s food price outlook

As the conflict continues in the Middle East, the farming community in South Africa is increasingly worried about rising input costs, particularly fertiliser and fuel. On both, the issue is not that South Africa has a supply constraint, but fear about the path ahead. Others are also worried about the impact of these developments on consumer food prices. What follows are broad views on how we should approach these issues.

First, we don’t have a fertiliser supply issue for now, but prices are rising due to fears of global supply disruptions. The conflict in the Middle East is a factor in the global fertiliser market, and we see a surge in prices and the region’s growing importance as a source of fertiliser ingredients. But what will matter the most in all this is the duration of the war — how long will the disruptions last?

The next major fertiliser usage period in South Africa and southern Africa’s agriculture is from October, when we plant summer crops. This means that if logistics in the Middle East ease before June, upside price pressures in the fertiliser market should soften, and farmers wouldn’t start the 2026-27 production season with a major cost burden.

Food prices

Another issue is how the fertiliser price surge will influence consumer food prices. On this, we must remember that farmers cannot directly pass on fertiliser costs to consumers. Farmers are price-takers. In extreme cases, farmers can influence prices by adjusting the area planted, but we don’t see this as a near-term possibility. And the new crop is only planted in October 2026.

The reality is that farmers will be under immense strain if fertiliser prices remain elevated for some time. Fertiliser accounts for 35% of grain farmers’ input costs and a substantial share of the input costs of other crops. However, the conflict is still in its early stages, and we don’t know how long the war and the disruptions to fertiliser will last. South Africa imports roughly 80% of its annual fertiliser usage.

Fuel prices

The farming sector is also concerned about fuel prices and supply availability in some areas. Generally, fuel supplies in South Africa remain healthy, but there may be unusual demand ahead of April price adjustments, which could disrupt supplies. Ideally, a normal buying pace would help immensely.

Fuel accounts for a notable share across various agricultural value chains, and harvesting and planting are the periods of highest use.

Farmers will start planting winter crops from the end of April in the Western Cape and later in other provinces. They will start harvesting grain in May, and citrus around the same time. These are high-fuel-use periods and will put immense financial strain on farmers.

At the moment, we face cost challenges and fewer general supply constraints across most of the country. This adds a strain on businesses.

Inflation

I also want to note that South Africa’s consumer food price inflation could moderate in 2026 due to ample supplies of grains, oilseeds, fruit and vegetables. This is a view I expressed at the start of this year, and I haven’t shifted from it. However, I am increasingly concerned that prolonged conflict in the Middle East could drive up fuel prices, disrupting my optimistic projection.

The latest data released by Statistics South Africa have not accounted for the war in the Middle East and still indicate a moderating path for food price inflation, underpinned by ample domestic supplies of grain, fruit, and vegetables. The data show that consumer food price inflation slowed to 3.7% in February 2026, down from 4% in January.

In essence, I expect South Africa’s consumer food price inflation to slow in 2026, but fuel prices remain a major upside risk, as they account for a substantial share of food product distribution costs. About 80% of South African grain and a substantial share of other products are transported by road. Therefore, higher fuel prices can be partly passed through to the final prices consumers pay for their products.

Overall, the events in the Middle East present higher cost pressures on the farming sector, and this is of considerable concern. But for consumers, the price increases may not be as high as some predict, and hopefully, stakeholders in the value chain don’t unjustifiably increase prices too early.

There is generally a lag between price adjustments in inputs and the final products we see on our shelves; thus, I don’t expect a sudden price change in food products. The other positive factor is that South Africa had a favourable agricultural season, and has ample supplies that should contain excessive price increases. DM

Wandile Sihlobo is the presidential envoy on agriculture and land. He is also the chief economist of the Agricultural Business Chamber of South Africa, and a senior research fellow in the Department of Agricultural Economics at Stellenbosch University.