Fertiliser price surge to hit low-income EMs most acutely

The main impact of the rise in fertiliser prices on the global economy will come via higher food inflation. But this will take time to materialise and will be much smaller than the increase in inflation after the start of the war in Ukraine. The economic repercussions of higher fertiliser prices will be largest in some lower-income EMs, particularly in Africa and South Asia, due to the large size of their agricultural sectors, the importance of food in their CPI baskets and the risk of balance of payments strains.