Fertilizer spike adds up to $35/acre for US corn as Iran crisis deepens
Source: AgFunderNews
Rising fertilizer prices triggered by the effective closure of the Strait of Hormuz “raise the risk of widespread demand destruction” as farmers reduce application rates, delay purchases, or shift crop choices, warns Rabobank in a new report . “With 30% of global urea, 27% of ammonia, 24% of phosphates, and 48% of sulfur exports transiting this corridor, the shutdown creates a supply shock that cannot be fully replaced,” says the bank.
“Nitrogen markets are the most exposed, and phosphate markets are similarly pressured.” While potash remains comparatively more balanced given a more diversified supply base, the indirect effect of higher prices for other nutrients used in fertilizer will likely weigh on demand for this as well. “The outlook for 2026 points to continued pressure on farm economics and increased downside risks for global crop production and food price stability.” Notably, North African players such as Egypt and Algeria have become critical nitrogen exporters, with “recent urea shipments to Canada show how trade flows are shifting as Middle Eastern availability contracts,” says Rabobank.
“Nigeria is also strengthening its position in Atlantic markets, particularly Brazil and the US, supported by its three urea plants. Morocco continues to anchor the global phosphate market, with limited alternative supply giving its MAP (Monoammonium Phosphate), DAP (Diammonium Phosphate), and TSP (Triple Superphosphate) exports strong price-setting power.” US and Canada While many farmers bought fertilizer before the conflict began, risks are shifting to the next planting cycle, especially if exports are redirected abroad and phosphate production—which relies on sulfur—tightens, warns Rabobank.
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