NASHVILLE, Tenn. (RFD NEWS) — Fertilizer prices are rising as uncertainty surrounding the war involving Iran continues, with global supply chains still under pressure. Markets responded positively to signals that Iran may reopen the Strait of Hormuz, but analysts say it will take time to clear the backlog of shipments waiting to move through the region.
Agriculture Secretary Brooke Rollins says the Trump Administration is taking an all-of-government approach to address rising input costs. She was joined this week by leaders from the Environmental Protection Agency and the U.S. Department of Commerce to announce that the Jones Act will be suspended for another 90 days.
Analysts say the initial suspension in March helped ease some logistical pressure. Rollins also pointed to additional steps, including adding potash to the federal critical minerals list and efforts to expand domestic production of potash, nitrogen, and phosphate fertilizers over the next two years. She added that revised diesel exhaust fluid rules could help lower other input costs for producers.
Price data shows just how quickly costs have climbed. Since mid-February, DTN reports urea prices are up 41 percent, while anhydrous ammonia has gained 29 percent. On the year, urea prices have climbed nearly 50 percent. Other fertilizers, including potash and 10-34-0, have posted smaller gains of less than 10 percent year-over-year.
Analysts at StoneX say rising costs are straining the fertilizer supply chain and could push shipping costs even higher. Analyst Josh Linville said prices for urea barges have surged sharply since the conflict began.
“Your urea barge is before this thing happened, it was in the upper $400s — I want to say, it was $473 the day before the attacks began — today, the highest price we’ve seen traded is $695. So we’re up over $200 a ton, and that’s NOLA,” Linville explains. “The scary thing is that doesn’t take into account the basis that we’ve started to see blow out because all the farmers have been waiting, rightfully so. I don’t blame anybody for doing it, but they’ve been waiting and taking a just-in-time demand model. The retailer, not having the farmer step up and buy it, is saying, ‘I’m going to wait, and that’s fine.’ And a lot of times, just-in-time demand can cause prices to fall. But in this case, I’m afraid what we’re doing is we’re getting back into a corner, and suddenly we’re going to start paying just-in-time logistics.”
Linville says the cost pressures extend beyond barge traffic, warning inland shipping rates could climb further as more buyers turn to truck and rail to secure supplies.
Fertilizer Prices Raise Pressure on Grain Marketing Plans
Higher fertilizer prices are forcing row-crop producers to rethink break-even levels and marketing plans as the planting season progresses. Adam Rabinowitz with Alabama Extension told Oklahoma Farm Report that the recent jump in fertilizer and diesel costs is another reminder that input volatility can quickly change what counts as a profitable sale.
The report said fertilizer, especially nitrogen, is closely tied to natural gas and broader energy markets. That has kept attention on the Middle East conflict, the Strait of Hormuz, and the risk that higher energy costs could continue to push farm inputs higher.
The regional picture adds another challenge. An American Farm Bureau Federation survey found only 19 percent of Southern farmers had pre-booked fertilizer, compared with 67 percent in the Midwest, leaving more Southern producers exposed to higher late-season costs.
Rabinowitz said the issue is bigger than one recent spike. Even before the latest move, fertilizer and diesel prices had not returned to pre-2021 levels, meaning farmers are still working from a much higher cost base.
The report said producers may need to market in smaller increments, update break-even targets frequently, and plan carefully for storage and cash-flow needs if more bushels remain unpriced at harvest.
Corey Rosenbusch with The Fertilizer Institute joined us to discuss supply chain disruptions and what farmers should watch as global tensions impact fertilizer markets.
