Global fertilizer trade down 30% this year amid Iran war, UN says

Global trade in fertilizers crucial to agriculture harvests worldwide has slumped 30 percent since the start of the year, as the Iran war sent prices soaring and led several countries to restrict exports, the UN’s Food and Agriculture Organization says.

Many farmers have delayed or forgone purchases as supplies tightened with Iran’s effective closure of the Strait of Hormuz, blocking shipments of the raw materials and liquefied natural gas (LNG) used in fertilizer production.

At the same time, China, Russia, Turkey and Egypt are among the main producer countries that have limited exports to protect their domestic markets.

Prices on average jumped 25 percent between February and May, according to FAO data released in its biannual Food Outlook report.

As a result, trade volumes fell to 41 million tons in the first four months of this year, down from 58 million tons in the same period last year.

Even if the strait reopens under a deal signed by the US and Iran this week, “recovery across nitrogen, phosphates, and sulphur-linked inputs would be slow and uneven, keeping prices historically elevated”, the FAO warns.

A third of the world’s fertilizer supply passed through the Strait of Hormuz before the war that began on February 28, and officials have warned that farmers could face shortages during the summer growing season.