What was said: Last week, we outlined several certainties emerging alongside the uncertainty created by the Middle East conflict: increased Russian oil purchases by China and India, depleted munition stockpiles requiring replenishment and helium supply becoming structurally fragile. Performance across those themes was mixed, but the underlying dynamics remain intact.
As the conflict continues, those certainties are beginning to compound. Nitrogen and fertiliser supply chains are now under pressure. Roughly 45% of the world’s tradable urea and 20% of ammonia supply come from the Middle East, leaving global agriculture exposed just weeks before the Northern Hemisphere spring planting season. With Russia sanctioned and China restricting exports, alternative supply is limited.
Fertiliser production is tightly linked to energy markets. Urea and ammonia plants sit alongside natural gas infrastructure and are highly exposed to energy disruption. During the 2021–2022 energy shock, gas prices rose above $60/MMBTU, and ammonia prices reached $2,100 per tonne, pushing fertiliser input costs sharply higher relative to crop prices.
Aluminium supply is also under direct threat. Bahrain's Alba, the world's largest aluminium smelter outside China, has begun output cuts alongside Norsk Hydro's Qatar shutdown.
At the same time, defence and public safety spending continues to accelerate across the security stack. Military spending is rising alongside investment in surveillance systems, screening technologies and battlefield intelligence capabilities as governments respond to a more fragmented geopolitical environment.
Energy is also returning to the centre of political debate. As oil prices rise, the discussion around reopening domestic production and strengthening energy security is gaining momentum, particularly in regions that have historically reduced upstream investment.
Why we give a ****: The longer the conflict persists, the more it shifts from a geopolitical story into a global supply chain story.
First, fertiliser markets are becoming the newest pressure point. Any sustained disruption to Gulf energy flows risks pushing fertiliser prices higher just as farmers prepare for the spring planting season. Because nitrogen fertilisers underpin global crop production, supply shocks can quickly feed into broader food inflation.
Second, defence spending continues to broaden beyond traditional military procurement. Investment is expanding across the entire security ecosystem, from munitions production to public safety infrastructure and advanced surveillance technologies.
Third, energy security is increasingly dominating policy decisions. Higher oil prices strengthen the case for reopening domestic production and accelerating upstream investment after years of underinvestment in global supply.
Fourth, aluminium is becoming another casualty of the Middle East disruption, with Gulf smelter curtailments threatening 23% of non-Chinese supply and adding industrial metals to the list of conflict-exposed commodities.
The broader takeaway is that defence supply chains, fertiliser markets and energy infrastructure are increasingly being treated by markets as strategic sectors rather than cyclical ones.
Relevant stocks: NASDAQ: ASPI, LSE:CNE, LSE:AET, LSE:HBR, LSE:BP, SSE:600938, LSE:KIST, LSE:BAB,
Best Content Shared This Week
🎧 War’s Next Shock: Fertiliser
Why Listen? The Iran conflict isn’t just driving oil higher. It’s also pushing up fertiliser costs, such as urea and ammonia, just as the spring planting season begins, raising the risk of another global food price shock. Listen here.
📺 The $10 Trillion Warning
Why Watch? Scott Galloway argues the Iran conflict could trigger a broader financial chain reaction, with sustained higher oil prices potentially reigniting inflation, constraining central banks and putting global markets at risk of a multi-trillion-dollar sell-off. Watch here.
Stock Of The Week
Crypto Infrastructure Going Global
CoinShares is one of Europe’s leading digital asset investment firms, offering regulated exposure to cryptocurrencies through ETPs and institutional asset management, positioning the company at the centre of the growing market for institutional crypto infrastructure.
The key catalyst is its transition from Nasdaq Stockholm to a US Nasdaq listing via a merger with Vine Hill Capital, with trading in the new entity Odysseus Holdings expected to begin 31 March. The move broadens the investor base at a time when institutional demand for regulated crypto products is rising, while a $0.33 per share dividend (~4.5% yield) underscores the company’s cash-generative model.
New or Updated Showcases
Majestic Corporation
- Majestic Corporation is a specialised apparel supply chain platform providing design, sourcing and manufacturing solutions for global fashion brands, positioning itself at the intersection of fast-cycle fashion production, vertically integrated sourcing and scalable Asian manufacturing as retailers increasingly prioritise flexible supply chains and rapid product turnaround. Read the investment case
Survey time
Curation ESG is running a short 2-minute survey to understand better how people think about ethical and responsible investing. As a thank you for taking part, one participant will win a £100 prize. Follow the link below to start
.svg)
