GEOFF BENNETT: Let's focus now on some of# the economic effects of the war with Iran.

About a third of the world's fertilizer# supply passes through the Strait of Hormuz,## and its effective closure is causing shortages and## price spikes for fertilizer during# the crucial spring planting season.## That has led to fears of both elevated food# prices and lower crop yields across the globe.

This morning, Agriculture Secretary# Brooke Rollins told PBS News' Liz## Landers that -- quote -- "everything was on the# table" to fix the problem for American farmers.

BROOKE ROLLINS, U.S.

Secretary of# Agriculture: Clearly, this -- I## think we're at 36 days for the conflict --# has elevated the iss.. how important it is for American farmers# and, frankly, for our food supply.

The good news is that about# 80 percent of our farmers## actually last fall locked in their fertilizer,# so, as we're moving into planting season,## it's only about 20 to 25 percent of# our farmers that didn't lock that in.## We are working directly to ensure that we can get# them what they need and it won't bankrupt them.

GEOFF BENNETT: Now, despite those numbers,## farmers we spoke with say they fear these# cost increases could put them over the edge.

Here's some of what they told us.

RUSSELL BOENING, Texas Farmer:# My name is Russell Boening.## My family and I farm right south of San Antonio.# We're buying nitrogen right now.

And it's about## 40 percent higher than it was two or three months# ago, before the conflict.

Let's just say that.

LANCE LILLIBRIDGE, Iowa Farmer: I'm Lance# Lillibridge from Benton County, Iowa.

We booked most of our fertilizer before the# conflict in Iran.

However, some of it we did## not because it was too expensive.

We're probably# going to go without that particular nutrient## on our crop this year.

A lot of other# farmers are doing the same thing.

MATT FROSTIC, Michigan Farmer: My# name is Matt Frostic.

I have a crop## and livestock operation in Michigan.

In January,## we were looking at nitrogen for about $350 a# ton.

Today, that number is bouncing around $600.

STEVE TURNER, Illinois Farmer:# Steve Turner.

I am a farmer in## northwest Illinois located about# 40 miles northwest of Springfield.

We have got a lot of our inputs paid for,## but I'm afraid we're going to be looking# at some elevated prices for a while.

RUSSELL BOENING: There's people saying, well,# there's 80 percent of the fertilizer has already## been purchased for this year's crop.

And# we actually heard that figure from USDA.## Even if 80 percent is pre-purchased and the# other 20 percent goes up 50 percent or more,## it can still be a pretty good hit for you.

MATT FROSTIC: The reality is, we're not breaking# even.

We didn't break even the last two years.

LANCE LILLIBRIDGE: With increases in input prices,## there are no margins.

They# appear to be zero at this point.

STEVE TURNER: It's just not the fertilizer.

It's# going to be the fuel end of this thing.

And I know## everybody's experiencing that right# now with the elevated fuel prices.

RUSSELL BOENING: You know, I always say,# if gas and diesel go up, if oil goes up,## everything else is going to# follow in some form or fashion.

MATT FROSTIC: As fuel becomes expensive and# it's hard to produce that crop or costs more to## produce and transport that crop, it# all kind of equates to higher prices.

LANCE LILLIBRIDGE: So much of growing# a crop is out of our control, and## we can only manage certain things.

When the prices# of these inputs become so high, it's -- gosh,## what do we do?

I don't know.

And I don't# think anybody's got a wonderful answer to it.

RUSSELL BOENING: Well, when it comes to policy,# I mean, frustration might be a little bit of a## strong word.

There's maybe anxiety even before the# conflict.

Let's be honest about it.

Tariffs have## caused the price of our inputs to increase.

If# you want to look at it from the 30,000-foot view,## agriculture pretty much still trusts this# administration.

That's still what I hear.

STEVE TURNER: When you look at the Strait# of Hormuz, we have got to have shipments out## of there.

And I think anything, whether# it's our U.S.

Navy or whatever it is to## stabilize that region to get shipments out of# there, because we were already fighting record## inflation and a price squeeze already.# And this is just more on it right there.

GEOFF BENNETT: For more on the# impact of this fertilizer shortage,## return now to Caitlin Welsh.

She's the# director of the Global Food and Water## Security Program at the Center for# Strategic and International Studies.

Welcome back to the program.# It's good to have you.

CAITLIN WELSH, Center for Strategic and# International Studies: Thanks .. GEOFF BENNETT: So the Strait o.. longer than a month.

How critical# is it for global fertilizer supply?

CAITLIN WELSH: Very critical, and for a number# of reasons, first of all, because the Gulf is## responsible for production of a significant amount# of major fertilizer types, exporting -- being## the top exporter of some major types of# nitrogen fertilizer and phosphate fertilizer.

The Gulf is also responsible for significant# proportions of exports of inputs to fertilizers## as well, liquefied natural gas and sulfur.

And,# combined, both the restrictions on exports to## fertilizer and inputs to fertilizer has# caused the price spikes we just heard about.

GEOFF BENNETT: Well, say more about that.# What has it meant for prices and availability?

CAITLIN WELSH: Yes, the prices of all# fertilizers are increasing, whether or not## they're exported from the Gulf.

And the prices# of nitrogen-based fertilizer, particularly,## like some of the ones we just# heard the farmers reference.

One type of nitrogen fertilizer has# increased by 45 to 50 percent month## on month.

What that means for farmers right now,# as you mentioned, in the spring planting season,## a lot of farmers are faced with high prices.# Some farmers, in fact most farmers in the## United States had already secured the fertilizer# they needed for this planting season beforehand.

But those who didn't needed to purchase fertilizer# in global markets and were exposed to those high## prices.

When that happens, farmers have to make# choices.

They plant less crops, they apply less## fertilizer or they switch the crops that they# plant.

All of those have long-term effects.

GEOFF BENNETT: Globally, what are the# biggest risks if this disruption continues?

CAITLIN WELSH: So, the biggest risks come in two# categories.

One is risks from high fertilizer## prices.

And that -- those risks change# depending on the time horizon of this war.## The nature of the countries affected# and how they're affected changes.

When you look at the countries that were# importers of the products that I mentioned,## the final fertilizer products and the inputs# to fertilizers, those include some of the## world's major agricultural producers# and exporters.

So, potentially many## really important countries on# ag markets could be affected,## alongside a lot of countries that are# food-insecure could also be affected.

But the other category it impacts comes# actually through a different channel,## which is high energy prices.

And it's actually# through high energy prices that we're expecting## to see high food prices in the short# term in the U.S.

and around the world.

GEOFF BENNETT: If the strait were to reopen# tomorrow, how quickly could the supply recover?

CAITLIN WELSH: Weeks to months likely.

GEOFF BENNETT: Really?

Months?

CAITLIN WELSH: Mainly because liquefied# natura.. inputs to nitrogen fertilizer.

And what# we have seen are intentional attacks on## LNG production facilities.

So, the duration# of time it takes to get those facilities back## online is going to affect how long it's going# to take to get fertilizer prices back to normal.

GEOFF BENNETT: There are comparisons to the 2022## disruption after Russia's invasion of# Ukraine.

Is that a fair comparison?

CAITLIN WELSH: Yes and no.

It's a fair comparison, in that# major commodities are affected## in both scenarios and the timing was# very, very similar almost to the day.## In the case of Russia's invasion of Ukraine,# you had fertilizers and fuel and food exports## affected.

In the case of this war with Iran,# you have fertilizers and fuel affected mainly.

With Russia's invasion of Ukraine,# because millions of tons of grains## were effectively locked in Ukraine's# ports immediately after the invasion,## that's why you saw global food prices spike# to a historic high within a matter of weeks.

In this case, again, it will take some time# to see the impacts of high fertilizer prices## on agriculture markets and food prices, but in# the near term, it's high energy prices that are## driving food prices higher globally.

We# saw the first report of the U.N.

Food## and Agriculture Organization out just a# few days ago looking at prices in March.

The price of all major ag# commodities had increased.

GEOFF BENNETT: Well, that was my next question for# you.

We talked about the impact on these farmers.

CAITLIN WELSH: Yes.

GEOFF BENNETT: But, for regular consumers, I hear you say that we might not see the price# increases for, what, a couple more weeks?

CAITLIN WELSH: A couple more weeks.

I will be looking for the Consumer Price.. I will be watching for subsequent reports from the## U.N.

Food and Agriculture Organization.

The# World Food Program of the U.N.

expects that## the impact of high energy prices alone will# increase the number of people experiencing## acute food insecurity by up to 45 million,# depending on the duration of the war.

And those impacts could spike within a few months.## So it takes a few months for the# impacts of high energy prices## to bear out on high food prices.

That's what we# saw in the case of Russia and Ukraine as well.

GEOFF BENNETT: Caitlin Welsh,# thanks, as always, for your insights.

CAITLIN WELSH: Thank you for having me.