Record tanker freight through Hormuz threatens another rise in farmers’ costs

The crisis around the Strait of Hormuz has sharply increased the cost of seaborne energy transport, creating new risks for agricultural production costs. The cost of chartering a VLCC supertanker to ship US crude oil to Asia has risen to a record $77 mln, compared with an average of $9.2 mln in 2025.

For a standard 2 mln-barrel cargo, such freight adds around $38.5/barrel in transportation costs alone. Even if crude oil prices stabilize, such expensive logistics could keep fuel and other energy-dependent inputs costly.

For agriculture, this means additional pressure on diesel, transportation and grain-drying costs. More expensive energy logistics also raises the cost of producing and transporting fertilizers, a significant share of whose feedstocks is linked to the Middle East.

The problem is compounded by longer shipping routes and slower tanker fleet turnover caused by the crisis. This effectively reduces the number of available vessels and keeps freight rates elevated even as export flows from the region partially recover.

If high freight rates persist, farmers could face another increase in production costs ahead of periods of intensive fuel and fertilizer use. The Hormuz crisis is therefore continuing to affect agricultural markets even without a direct decline in energy supplies, through the sharp increase in delivery costs.

Tags: Hormuz, freight rates