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Concerns about long-term nitrogen price hikes as Middle East tensions continue

An agribusiness group says ongoing tensions in the Middle East could cause long-term global supply disruptions for nitrogen fertilizer.

Mike Seyfert, CEO of the National Grain and Feed Association says shipping constraints will continue to impact prices.

“A lot of these vessels operate on the same route,” he says. “If you have to extend some of the routes, does that add on additional cost? We’d like to have some certainty, and I think a lot of the things we thought we had some certainty on in terms of fertilizer costs, we’re now just going to have to see how the market works through that.”

Frayne Olson with North Dakota State University tells Brownfield supply chains for phosphorus and potassium have work arounds, but, “Even though the U.S. doesn’t buy a lot of nitrogen from the Persian Gulf, I’m a bit concerned we may have some problems even with fall fertilizer.” 

Both say prices are expected to stay elevated until the market sees global tensions weaken.

AUDIO: Mike Seyfert, National Grain and Feed Association

AUDIO: Frayne Olson, North Dakota State University