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Fertilizer prices likely stay above pre-Iran war levels through 2028
CoBank estimates Middle East instability has already disrupted ammonia production, with 31 ammonia plants in the region impacted or shut down, and 49 plants curtailed in parts of South Asia.
CoBank projects global fertilizer prices will remain above pre-Iran war levels through 2028, despite pulling back from historic highs, as conflicts and supply chain disruptions continue to reshuffle the nutrient market. In its Knowledge Exchange report, the firm cites ongoing instability in the Middle East, constrained feedstock supplies, and tightening phosphate availability as key drivers keeping costs elevated for US agricultural participants.
CoBank said the Middle East is especially influential in fertilizer flows, supplying more than 60 million tons of fertilizers and raw materials annually, with about 45 million tons shipped through the Strait of Hormuz. It also pointed to concentration risks in sulfur and key inputs, noting that the region accounts for 50% of globally traded sulfur and more than 30% of urea exports, making fertilizers and related commodities vulnerable to supply disruptions.
For US buyers, the report links the Iran war to the greatest exposure in urea and phosphate, citing growing demand for products imported through the Persian Gulf. CoBank added that the conflict has contributed to fertilizer plant shutdowns and damage that will take significant time to repair, including estimates that 31 ammonia plants in the Middle East have been directly impacted or fully shut down.
The report also highlighted broader damage and curtailments, including 49 plants across India, Pakistan, and Bangladesh operating at reduced levels or halted due to limited feedstock availability, and at least 20 plants in Russia damaged by Ukrainian drone attacks. CoBank said those disruptions have reshaped global trade flows and pushed up prices for US agricultural retailers, particularly for diammonium phosphate and monoammonium phosphate.