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Ukrainian Grain & Oilseed Market

Ukrainian Grain&Oilseed Market

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Fertilizer prices set to spike: What the Iran conflict means for your farm

04.03.2026 06:08 "Agro Perspectiva" (Kyiv) — The conflict in Iran threatens to disrupt a major fertilizer production and shipping hub, raising the risk of higher crop costs and food inflation.

The Gulf region is home to some of the world’s largest fertilizer plants, and the Strait of Hormuz handles about one-third of the global trade for the nutrients. Prices were already high before the latest conflict in the Middle East erupted, and the fresh tensions come as Northern Hemisphere farmers are set to start applying the products to their fields.

The timing of the conflict «literally could not be worse» for the industry, Josh Linville, vice president for fertilizers at brokerage StoneX Group, said by email. «There is never a good time for war, but this couldn’t be much worse.»

The conflict is already impacting the market. On Monday, Qatar shut down liquefied natural gas production at the world’s largest export facility after it was targeted in an Iranian drone attack. Natural gas is a crucial input for nitrogen-based fertilizers.

Qatar is a source of some 11% of global urea exports, and nearly 45% of those shipments come from Persian Gulf facilities more broadly, according to Alexis Maxwell, an analyst at Bloomberg Intelligence.

Prices for granular urea in Egypt have surged by $60 a metric ton since the effective closure of the Strait of Hormuz, and buyers are already looking for other suppliers in North Africa and Southeast Asia, Bloomberg Green Markets reported.

Meanwhile in New Orleans, the price of March barges for urea — the most widely used nitrogen fertilizer and one crucial to corn fields — were $60 to $80 higher on Monday compared with Friday prices, and there is «potentially hundreds of dollars per ton increases in the coming days,» said Taylor Eastman, a fertilizer trader at Andersons Inc.

Supplies of urea were already tight before the Iranian conflict, and geopolitical risks were high. Drone damage to a Russian nitrogen had spurred bullish sentiment in the market. Russia and Qatar are the two biggest urea suppliers to the U.S., according to the Department of Agriculture. While the U.S. does not import much of the crop input from Iran directly, significant flows come from other Middle Eastern countries through the Strait of Hormuz.

Three out of the world’s 10 largest ammonia exporters and one in five top phosphates suppliers rely on the waterway to get the product out, according to StoneX.

Even if supplies continue flowing through the strait, the cost of freight insurance could become «economically unviable,» Scotiabank analyst Ben Isaacson wrote in a note. Iran controls 10% to 12% of the global urea trade, while Israel’s declaration of a state of emergency could interrupt gas deliveries to Egypt and therefore fertilizer production, he said.

Fertilizer stocks soared before paring some gains. Yara International ASA rallied to a three-year high. The company said that although it has «limited exposure to the region,» the Strait of Hormuz is a «critical chokepoint.»

«Disruptions of this scale will affect fertilizer and food prices, but it is still too early to assess the magnitude or duration,» Yara said in a statement. «We know that many farmers are already under cost pressure. They play a crucial role in global food security.»

CF Industries Holdings Inc., the world’s largest ammonia producer, jumped as much as 8.3% to the highest since late 2022, while the broader S&P Composite 1500 Fertilizers and Agricultural Chemicals Index touched the highest since July.

Source: FarmProgress

Agro Perspectiva

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