Conflict in the Middle East Raises Uncertainties in the Soybean Market

The attack by U.S. forces on Iranian nuclear facilities has reignited tension in the Middle East and brought repercussions to the global energy market. Three uranium enrichment centers located in Fordow, Natanz, and Isfahan were hit. In response, Iran announced the blockade of the Strait of Hormuz, an important corridor through which approximately 20% of oil and 25% of liquefied natural gas consumed worldwide pass. According to an analysis by Grão Direto, released this Monday (23rd), the offensive and the blockade should directly impact soybean oil quotations, given the strong correlation between energy and oilseed markets. Beyond oil, the conflict also affects the fertilizer sector. Iran, responsible for an annual production of around 7 million tons of nitrogen fertilizers, exports approximately 5 million tons of this volume. Grão Direto warns that, with the escalation of the crisis, there is a risk of increases in international prices of these inputs, as well as possible ...