How the Middle East War Is Raising Food and Consumer Goods Prices

Fertilizer is the longer-lasting risk. FAO identifies the Strait of Hormuz as a critical chokepoint not only for oil and gas, but also for fertilizer flows, and says disruptions are already raising energy and agricultural input costs worldwide ^[7]. That matters because fertilizer shortages and higher energy prices can threaten crop yields, making the food-price impact extend beyond the current shipping cycle into future harvests ^[7].

So far, the food-price signal is more about pressure than universal scarcity. The FAO benchmark index tracked by Euronews rose for a second consecutive month and was about 1% above its level a year earlier, while supplies were still described as stable ^[10]. The caveat is that stable supplies today do not remove the risk of higher input costs affecting planting decisions, yields and food-price volatility later.

How consumer goods costs rise

Consumer goods are exposed through shipping. After the latest Israel-Hamas war began in October 2023, Houthi attacks on vessels in the Red Sea led many shipping companies to avoid the Red Sea and Suez Canal. Detouring around the Cape of Good Hope adds roughly 3,500 nautical miles and at least 14 days to some voyages, with Asia-Europe trade especially affected ^[18].

The scale of the chokepoint is large. The IMF says the Suez route normally carries about 15% of global maritime trade volume ^[25]. World Bank analysis says the Suez Canal and Bab el-Mandeb Strait previously carried about 30% of world container traffic; by the end of 2024, vessel traffic through those routes had fallen by about three-fourths, while navigation around the Cape of Good Hope rose by more than 50% ^[20].

Longer and riskier routes raise costs before goods even reach store shelves. J.P. Morgan Research said higher shipping costs are likely to pass through to imported-goods prices with a lag, depending on the duration and intensity of the disruption, and estimated that Red Sea disruptions could add 0.7 percentage points to global core goods inflation and 0.3 percentage points to overall core inflation ^[30]. Insurance is another part of the cost stack: CSIS noted that cargo insurance plays a major role in Red Sea routing decisions and that rates for Red Sea and Bab al-Mandab voyages had risen sharply ^[28].

Who feels the shock most

The burden is uneven. Import-dependent economies are more exposed because they must buy fuel, fertilizer and food at higher global prices. FAO specifically warns that food-price volatility could be amplified in Africa, Asia and other import-dependent regions ^[7]. UNCTAD has also warned that shipping disruptions are driving up costs, reshaping trade patterns, upending energy and food flows, and threatening food-security risks especially in vulnerable economies ^[27].

Companies and consumers tied to Asia-Europe supply chains are also more exposed because those flows rely heavily on the Suez route and have been particularly affected by Red Sea diversions ^[18]. For consumer goods, the effect may show up as delayed deliveries, higher import costs and gradual price increases rather than an immediate jump on every shelf.

Why prices can rise without immediate shortages

The key distinction is between supply availability and supply-chain cost. Food markets can remain physically supplied while prices still rise because fuel, fertilizer, freight and insurance are more expensive. That is why FAO-linked reporting can describe stable supplies at the same time as rising global food commodity prices ^[10].

There is also a timing lag. Shipping costs do not always hit retail prices instantly; they pass through as contracts reset, inventories turn over and companies decide how much cost to absorb or pass on. That lag is why the consumer-goods impact can continue even after the original freight shock begins ^[30].

What to watch next

Three indicators matter most: whether energy flows through the Strait of Hormuz remain reliable, whether fertilizer costs and availability stabilize, and whether ships can return safely to the Red Sea and Suez routes. FAO flags Hormuz as a critical chokepoint for oil, gas and fertilizers ^[7], while Red Sea diversions have already added distance and time to major trade routes ^[18].

If energy prices stay elevated, the effect can spill beyond groceries and retail goods into overall trade. WTO economists have warned that sustained energy-price increases linked to the Middle East conflict could reduce 2026 merchandise trade growth from 1.9% to 1.4% and put pressure on food supplies and services trade ^[14].

The bottom line: the Middle East war is acting like a global cost amplifier. It raises the price of energy, the cost of growing food, and the expense of moving goods around the world. The impact is real, but it is not uniform; the sharpest pain falls on import-dependent economies, exposed shipping corridors and consumers with the least room to absorb higher essentials costs.

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