The Iran War and rising fuel and fertilizer prices: Implications for Myanmar’s rice value chain

Ian Masias, Bart Minten, Joseph Goeb, May Thet Htar and Nilar Aung

No 132, Other briefs from International Food Policy Research Institute (IFPRI)

Abstract: The Iran War has driven up fuel and fertilizer prices in Myanmar and created the risk of shortages in some parts of the country. At the end of June, diesel prices were 34 percent higher and petrol prices 57 percent higher than at the end of February, while reference prices for urea in mid- and late June were 49 and 28 percent higher, respectively, than last monsoon season. Myanmar’s rice value chain depends heavily on fertilizer for paddy production and on fuel for land preparation, irrigation, harvesting, transport, and processing. Alongside an expected El Niño, these higher costs of fuel and fertilizer are likely to lower yields and rice production in the 2026 monsoon season. Higher costs are likely to reach consumers, raising the price of rice, the country's main staple, and worsening food security at a time of already high humanitarian need. Recommended Actions: Ease forex restrictions and import licensing on fertilizer imports, which raise input prices above those of regional competitors. Promote more efficient use of chemical fertilizer, since prices are likely to stay elevated even after the crisis eases. Support the local production of organic fertilizer and educate farmers on its effective use, to reduce reliance on imported chemical fertilizer. Expand alternative and more reliable energy sources, addressing a constraint that predates the shock. Expand alternative and more reliable energy sources, addressing a constraint that predates the shock.

Keywords: inflation; fuels; fertilizer industry; prices; agricultural value chains; rice; Myanmar; Asia; South-eastern Asia (search for similar items in EconPapers)
Date: 2026-07-01
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