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Fertilizer bidding paused amid Iran conflict

The senior vice president of plant foods at MFA Incorporated, a farm cooperative based in Missouri, says there’s been a partial pause on fertilizer bidding, due to the supply uncertainties caused by the Iran conflict.

Chris DeMoss tells Brownfield that’s across the U.S. fertilizer industry.

“They just kind of put no bids offered until they assess what’s going on,” he says. “There are some bids out there on urea, but not every company is offering it. And they’re doing it because they just don’t know where the sourcing is going to come from. We’re still not clear about, you know, the ships that are loaded. Are they going to be able to get out of the Gulf?”

DeMoss says there’s a lot of global fertilizer, like urea, phosphate, anhydrous and sulfur, produced in the Middle East and the problem isn’t just production, it’s ships not wanting to enter the war zone and uncertainty as to whether product can leave.

That is resulting in higher prices and fewer offers in the market. On Monday, he says urea in New Orleans was a range of $20 to $50 per ton higher.

“But it’s really quarter two that’s probably got bigger question marks. Is there a vessel coming in someone could discharge?”

He says the total impact on farmers in the upcoming growing season depends on how long the conflict lasts, and if it stretches beyond four to five days “some of the nearby tons in the beginning of the season might not be as much of an issue, but it’s those tons that we need later on. Maybe the rice market, that southern market, will feel more of this impact in terms of supply. It’s going to have most likely an impact on values.”

DeMoss says the U.S. is already tight on urea, and until the dust settles, there’s a lot of unknowns. MFA has a fair amount of product positioned and there are tons available, currently.

DeMoss farmers should confirm with their local fertilizer dealer that they will have the tons needed this spring and work on solutions together.