Strait of Hormuz tensions push fertilizer prices up ~30%, forcing US farmers to rethink spring planting
Disruptions tied to the Strait of Hormuz and Iran-related tensions have driven a roughly 30% spike in fertilizer prices, pressuring U.S. farmers’ spring planting decisions, input purchasing and margins.
Fertilizer prices have risen sharply amid heightened tensions around the Strait of Hormuz and Iran-related conflicts, creating immediate planning pressure for U.S. farmers entering the spring 2026 planting season.
About one-third of global seaborne fertilizer transits the Strait of Hormuz. Persian Gulf exporters account for nearly half of global urea exports and about 30% of global ammonia exports, magnifying the route’s importance to global fertilizer supplies.
The Fertilizer Institute reported fertilizer prices increased roughly 30% between late February and early March. That rise comes as many U.S. producers weigh remaining input purchases for 2026 against higher costs and constrained working capital.
Corn is particularly exposed because it is fertilizer‑intensive; USDA figures cited in reporting show corn represents 95% of the total U.S. grain and feed production. University of Missouri Food and Agricultural Policy Research Institute director Seth Meyer said some farmers may shift acres toward crops that require less added nutrients, such as soybeans.
Decision timing is uneven: some growers have already pre-purchased fertilizer while others delayed orders awaiting price movements, aid program details, or financing renewals. Those unfinished purchases are contributing to planting and input decisions this season.
The price shock compounds a longer squeeze on margins. Since 2022, corn and soybean prices have fallen substantially while fertilizer and pesticide costs have largely remained elevated. Farm bankruptcies reached 315 Chapter 12 filings in 2025, up 46% from 216 in 2024, illustrating rising financial stress in the sector.
Tariffs enacted during the Trump administration added nearly $1 billion in costs on fertilizers, chemicals, machinery, and seeds between February and October 2025, according to North Dakota State University’s Agricultural Trade Monitor. Those tariffs also constrained soybean exports, although the U.S. still shipped 12 million tons to China as previously committed.
In December, former President Trump announced a $12 billion bailout plan to offset higher input costs and reduced export opportunities. USDA enrollment for that program runs from February 23 to April 17, 2026, a window that overlaps critical planting and input-purchase decisions for many producers.
Analysts note the Persian Gulf’s larger share of global fertilizer trade compared with Russia could make Iran-related disruptions more consequential for fertilizer markets than prior Russia-related shocks. An economist from the University of Arkansas described a 'rocket and feather' dynamic for input prices after disruptive events — rapid increases followed by slow declines — which can prolong pressure on farm margins.