Fertilizer cost pressure
Rising fertilizer costs and geopolitical disruption around the Strait of Hormuz are keeping upward pressure on farm input prices and could feed through to food costs. An analysis from Catalonia flagged higher fertilizer expenses for farmers, and Pro Farmer highlighted how Strait of Hormuz tensions are adding another layer of uncertainty for agricultural supplies. (en.ara.cat (profarmer.com)
Farmers are paying more for fertilizer again, and the latest disruption around the Strait of Hormuz is adding fresh pressure to costs before crops are harvested. (blogs.worldbank.org) The World Bank said in December 2025 that fertilizer prices had already risen more than 20 percent for the year, even after a late-2025 pullback, and stayed about 17 percent above year-earlier levels. Urea rose 4 percent month over month in November, while diammonium phosphate and triple superphosphate fell but remained expensive by pre-2022 standards. (blogs.worldbank.org) An earlier World Bank update in July 2025 showed how tight the market had become: its fertilizer price index was up 15 percent since the start of 2025, with triple superphosphate up 43 percent and diammonium phosphate up 23 percent. The bank tied the jump to strong demand, trade restrictions, and production shortfalls, especially in urea. (blogs.worldbank.org) The Strait of Hormuz matters because it is a narrow shipping lane for energy and bulk commodities, including fertilizer and fertilizer feedstocks. CNBC reported in March 2026 that about one-third of the global seaborne fertilizer trade passes through the strait, making any disruption there a direct risk to farm supply chains. (cnbc.com) Those higher input costs are already showing up in broader food markets. The Food and Agriculture Organization of the United Nations said its Food Price Index averaged 128.5 points in March 2026, up 2.4 percent from February, with higher energy prices linked to conflict in the Near East helping push prices higher across cereals, meat, dairy, vegetable oils and sugar. (fao.org) The same Food and Agriculture Organization update said international wheat prices rose 4.3 percent in March, partly because markets expected reduced plantings in Australia in response to anticipated higher fertilizer costs. Maize prices also got support from fertilizer affordability concerns ahead of Northern Hemisphere planting. (fao.org) The pressure is not coming only from shipping risk. The World Bank said China’s nitrogen fertilizer exports fell by more than 90 percent in 2024 as Beijing prioritized domestic supply, and those restrictions continued well into 2025, tightening global availability. (blogs.worldbank.org) Input costs inside fertilizer plants have also stayed volatile. The World Bank said in December 2025 that liquid sulfur prices had nearly tripled since the end of 2024 and ammonia prices were almost 15 percent higher after easing earlier in 2025, both of which added upward pressure to fertilizer prices. (blogs.worldbank.org) That leaves growers with a familiar choice from the 2021 to 2022 fertilizer shock: pay more, use less, or accept thinner margins. A 2024 review in Food Policy found that earlier fertilizer price spikes raised fears of lower application rates, weaker crop production and higher food prices, especially where farmers could not absorb the extra cost. (sciencedirect.com) For now, the market is caught between older supply constraints and a new geopolitical choke point. Until shipping through the Strait of Hormuz is steadier and fertilizer trade flows normalize, farm input bills are likely to stay under pressure. (cnbc.com)
