Source: Fertiliser raw material suppliers buy back stock as Middle East conflict rages – herald
Nelson Gahadza-Senior Business Reporter
ZIMBABWE’S fertiliser supply chain is coming under mounting pressure as escalating geopolitical tensions in the Middle East begin to choke global input flows, driving up prices and threatening the availability of the input ahead of crucial agricultural seasons.
What began as a regional conflict following the joint United States-Israel strikes against Iran on February 28 is now cascading into a full-blown global energy and logistics crisis.
Fertiliser markets are among the most affected due to their deep linkages with natural gas, petroleum and international shipping routes.
For Zimbabwe, where fertiliser production is heavily dependent on imported
raw materials, the effects are already being felt.Windmill Private Limited chief executive officer Mr Kudakwashe Mundowozi said the immediate impact has been a sharp tightening of supply, which is now feeding directly into price increases.
“The impact from the Middle East has largely been on pricing,” he said. “Prices will rise because raw materials are now in short supply.”
Mr Mundowozi said traditional trading patterns were beginning to reverse, underscoring the severity of the situation.
“For the first time, we have seen traders (raw material suppliers) coming back and asking us to sell (stock) back to them. It shows how dire the situation has become,” he said.
Zimbabwe’s fertiliser industry sources critical inputs from global producers such as Russia, Ukraine, Qatar and Egypt — countries that play a central role in supplying nitrogen, phosphate and ammonia-based products.
These inputs are highly sensitive to disruptions in energy markets and shipping routes.
The Middle East remains a strategic hub for global energy and the targeting of key infrastructure and transport corridors, particularly the Strait of Hormuz, has amplified risks across fertiliser value chains.
The waterway handles approximately 20 percent of global oil flows and is critical for the movement of liquefied natural gas, a key feedstock in nitrogen fertiliser production.
Zimbabwe’s industry relies heavily on imported potash and ammonia, leaving it vulnerable to external price shocks.
Despite having a potential production capacity of 1,5 million tonnes, actual output stands at around 300 000 tonnes, against a national demand of approximately 780 000 tonnes.
Key players include Windmill Private Limited and ZFC Limited, the nation’s largest manufacturers, alongside Superfert and Sunray Corporation.
While Dorowa Minerals typically supplies phosphate rock, it is currently not producing the product.
To address this, the Mutapa Investment Fund is actively working to capacitate value chain players like Dorowa and Sables to boost local production, reduce imports and support critical seasons, including the period for the winter wheat crop.
Economist Mr Persistence Gwanyanya noted that Zimbabwe’s structural dependence on imported inputs makes it especially vulnerable.
“Escalating conflict in the Middle East is exerting upward pressure on global commodity prices and constraining availability, creating significant pass-through effects on local input costs,” he said.
He noted that instability disrupts global logistics networks, pushing up freight charges and insurance premiums,
which in turn increase the landing cost of imports.Beyond rising costs, concerns are growing over the timing of these disruptions.
Analysts argue that this highlights a broader structural challenge: Africa’s overdependence on external suppliers.
Mr Gwanyanya highlighted that the continent has significant untapped potential to produce its own energy and fertiliser inputs, particularly through resources such as coal-bed methane.
“This volatility underscores the economic imperative for Africa to develop domestic production capacity for petroleum and gas products,” he said, adding that nations like Nigeria and Angola could anchor regional supply chains if intra-continental trade is strengthened.
Following a tour of Windmill Private Limited on Monda, chairperson of the Parliamentary Portfolio Committee on Industry and Commerce Mr Clemence Chiduwa warned of significant disruptions.
“The geopolitical tensions in the Middle East are going to have a negative effect on our supply chain,” he said.
“To access phosphate and other inputs from Ukraine and Russia, shipments often pass through affected regions.
“This will ultimately impact availability for the winter crop.”
The unfolding crisis has intensified calls for Zimbabwe to localise fertiliser production.
“By localising production, we can insulate ourselves against some of these geopolitical shocks,” Mr Chiduwa added.
Mqabuko Capital, a local research and financial services firm, warned that prolonged conflict could result in significant supply chain bottlenecks for Zimbabwe, including higher landing costs, fuel price volatility, freight constraints, inflationary pressures, production interruptions and export disruptions.
To mitigate these risks, the firm recommends that companies adopt more resilient operating strategies, including shifting towards renewable energy sources, securing trade finance and insurance, maintaining adequate foreign currency reserves and adopting forward pricing models to manage cost volatility.
It also urged companies to rethink inventory management by moving away from just-in-time models towards more precautionary approaches, while diversifying supply sources across multiple regions to reduce exposure to geopolitical risks.
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