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Fertilizer prices to stay elevated through 2027 even if Strait of Hormuz reopens, says analyst

The associate director of the Ag Risk Policy Center at North Dakota State University says even if the Strait of Hormuz reopens today, U.S. agriculture will likely be dealing higher fertilizer prices for several seasons.

Shawn Arita says getting things back to normal will take time, given the waterway must be secure and cleared, hundreds of vessels are backed up and some fertilizer production facilities have been damaged.

“Urea is hovering about $700 per metric ton. Even if over the next two weeks, if the straight reopens, it’s going to take some time for those boats to trickle out. Through the fall application period, we still see elevated prices much above $500, $500 to $600 for urea.”

He says fertilizer prices could remain elevated into 2027.

“Again, best case scenario, you still have these plants that are damaged, major plants, like Qatar Fertiliser Company, and it’s very unlikely for those to come back in 2027. We’ll still have elevated prices above the $500 level, still much above what we saw in 2025.”

Arita says he’s concerned fertilizer costs are rising without a similar increase in crop prices, putting additional pressure on already tight farm margins.

The Persian Gulf supplies a significant share of global fertilizer including urea, ammonia, MAP and DAP and sulfur.

Arita was a speaker at the Abner Womack Conference in mid-Missouri.