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Middle East conflict continues squeezing global fertilizer production

The CEO of The Fertilizer Institute says disruptions caused by the conflict in the Middle East continue to affect global markets.

In a Senate Ag Committee hearing on Wednesday, Corey Rosenbusch told attendees tighter global supplies are resulting in higher prices.  

“The closure of the Strait of Hormuz impacted about 34% of globally traded urea, 20% of phosphate, 20% of the natural gas is supplied from the region, and natural gas is the feedstock, of course, for all nitrogen fertilizer,” he says.

He says half of the world’s sulfur supply, which is crucial to fertilizer production, is also cut off causing increased bidding from several industries.  

“Without a doubt, sulfur is a big issue right now.”  He says, “With the spot market trading as much as $1,300 a metric ton, a lot of that is getting bought by Chinese for mining. When you look at copper, it might be $16,000 a metric ton to sell. That is where the free market is going to take a lot of that product as opposed to into fertilizer production.”

However, Rosenbusch says the Strait’s closure is only one of the challenges.

“There have been 31 ammonia plants that have curtailed production or have been damaged.”  He says, “Another 49 plants in India and South Asia were also shuttered due to disruption of their natural gas supply.”

He says it’s unclear the extent of damage to production in the region, but it’ll likely take months if not years to repair, meaning global supplies are likely to remain constrained into at least the 2027 growing season.