Since mid-April 2026, facing the disruption of the global fertilizer supply chain caused by the escalating conflict between the US, Israel, and Iran, the US has led emergency consultations with G20 member countries and international agricultural organizations to discuss solutions. A preliminary framework for a G20-level coordination mechanism has been established, with plans to build a global fertilizer supply chain emergency support mechanism. This mechanism aims to alleviate market panic by coordinating increased production capacity in major exporting countries, opening temporary transportation routes, and establishing a transnational reserve sharing system.
Prices Soar Across the Board, Reaching Record Highs
As of April 21, international urea prices had increased by over 93% since the beginning of the year. Middle East/Europe FOB prices surged to $755-840/ton, while the latest CFR tender price on India's east coast reached a record high of $959/ton. The phosphate fertilizer market is also under pressure, with Morocco's 64% diammonium phosphate FOB price reaching $800-805/ton, an increase of approximately 20% compared to March.
Sulfur, a core raw material for phosphate fertilizer production, has seen its price become a market "accelerator." Middle East FOB prices remain at $720-740/ton, an increase of approximately 26% compared to March. The global supply gap exceeds 2 million tons, directly pushing up the production cost of phosphate compound fertilizers. While potash fertilizer prices are relatively stable, prices in major sales regions such as Brazil and Southeast Asia have risen to $380-400/ton, an increase of over 15% since the beginning of the year.
The core of this crisis lies in the Strait of Hormuz. As a vital choke point for global oil and fertilizer transportation, shipping through the strait is currently near collapse, with transit volumes down by over 95%. According to UN data, approximately one-third of global seaborne fertilizer trade passes through the Strait of Hormuz, and liquefied natural gas (LNG) needed for fertilizer production is mostly imported from the Gulf region, which is also currently severely hampered.
In Europe, the European Commission has clearly stated that it will not temporarily suspend the carbon tax levied on imported fertilizers under the Carbon Border Adjustment Mechanism (CBAM). Despite calls from countries like Ireland to suspend CBAM to reduce import costs, EU Agriculture Commissioner Christophe Hansen stated that "an action plan aimed at expanding the fertilizer supply chain is being developed and is expected to be released in May," emphasizing that organic alternatives should be a strategic direction for EU agricultural development in the medium term.
The United Nations is actively mediating to push for an agreement among the conflicting parties on humanitarian transport routes through the Strait of Hormuz, prioritizing the passage of essential goods such as fertilizers and food. However, industry insiders point out that global fertilizer production capacity recovery will still take time, and a fully stable supply chain may not be achieved until the second half of 2026. Nitrogen fertilizer stocks have fallen to a near five-year low. Official data from the UN Food and Agriculture Organization shows that if supply-side issues are not alleviated, global grain yields this year may face a 3%-5% decline risk, equivalent to a reduction of approximately 120 million tons; if the conflict continues for more than three months, some institutions predict that the reduction could reach 5%-10%, raising concerns about a food security crisis.
