Disruptions to nitrogen fertiliser supply through the Strait of Hormuz could reduce global grain yields and shift planting decisions, potentially lifting grain prices, Goldman Sachs has said in a report, Reuters notes.

Fertiliser shortages may lead to lower grain output through delayed or suboptimal nitrogen application and encourage farmers to plant less fertiliser-intensive crops such as soybeans, the report noted.

In the US, where farmers import up to 50pc of urea fertiliser in some years, spring planting could face challenges as supplies remain around 25pc below typical levels, according to The Fertiliser Institute.

Nitrogen fertiliser, which accounts for roughly 20pc of grain production costs, has seen prices rise 40pc since the onset of the conflict, Goldman said.

Supply disruptions could tighten availability and increase production costs elsewhere, the bank warned.