Fertiliser prices may stay high
Market analysis warns fertiliser prices could remain elevated into 2027 as the U.S.–Iran war continues to constrain supply and raise input costs for agriculture. Extended high fertiliser costs ripple through food production and can increase pressure on processors and retailers downstream. (agtechnavigator.com)
Fertilizer prices are likely to stay elevated through 2027, even if the latest United States-Iran ceasefire holds and the Strait of Hormuz reopens. (agri-pulse.com) A new Agri-Pulse analysis published April 14 said damage to fertilizer infrastructure in the region could keep markets tight into 2028. The report comes as United States agriculture heads through spring planting with higher input bills. (agri-pulse.com) Fertilizer is plant food, mainly nitrogen, phosphorus and potassium, and much of the traded nitrogen supply moves through the Persian Gulf. The International Food Policy Research Institute said up to 30% of global fertilizer trade passed through the Strait of Hormuz in 2024. (tfi.org, ifpri.org) Since the war began after United States and Israeli strikes on Iran on February 28, shipping through Hormuz has been severely disrupted and several ships have been hit near the waterway. CNBC reported Egyptian granular urea, a benchmark nitrogen product, rose to about $700 a metric ton from roughly $400 to $490 before the war. (cnbc.com) Oxford Economics’ Alpine Macro told CNBC that urea prices had risen about 50% and ammonia about 20% since the war began. Chris Lawson of CRU said about 30% of exportable suppliers were effectively unavailable to the market during the disruption, including Saudi Arabia, Qatar, Bahrain and Iran. (cnbc.com) Higher fertilizer prices land on farms at the same time diesel and other operating costs are rising. The World Bank said its fertilizer price index climbed 26.2% in March 2026, while its energy price index surged 41.6%. (worldbank.org) United States farm price reports already show the jump in cash terms. In the Pacific Northwest, the United States Department of Agriculture listed average urea prices at $999.68 a ton and monoammonium phosphate at $1,120.47 a ton for the week ending April 3, with farm diesel averaging $5.98 a gallon. (ams.usda.gov) Those costs matter most for crops that need heavy nitrogen use. The National Corn Growers Association said fertilizer accounts for roughly one-third of corn operating costs, and a report citing United States Department of Agriculture estimates put 2026 corn fertilizer expense at about $165 per acre. (ncga.com, onthefarmradio.com) The food effect does not arrive all at once. The International Food Policy Research Institute said prolonged fertilizer shortages can push farmers to apply less, which can reduce yields and raise food-security risks, especially in import-dependent countries in Africa and South Asia. (ifpri.org) United States farm income was already under pressure before the latest fertilizer shock. The United States Department of Agriculture’s Economic Research Service said net farm income for 2026 is forecast at $153.4 billion, down 0.7% from 2025. (ers.usda.gov) For now, the market is waiting on the same question that opened this story: whether shipping resumes fast enough to ease the squeeze. Agri-Pulse said even the optimistic case still points to elevated fertilizer prices through 2027 and into 2028. (agri-pulse.com)
