Strait of Hormuz blockade stokes further chaos over future of fertilizer markets
Escalating geopolitical tensions in the Middle East are raising fresh concerns for global agriculture, as a new U.S. naval blockade in the Strait of Hormuz threatens to disrupt fertilizer supplies and drive already elevated input costs even higher.
The U.S. military began blocking ships entering or leaving Iranian ports on Monday, part of an effort to pressure Iran following failed negotiations over its nuclear program and regional conflict.
“We can’t let a country blackmail or extort the world, because that’s what they’re doing,” President Donald Trump said as the blockade took effect.
The move comes amid sharply reduced traffic through the critical shipping lane. The Strait of Hormuz typically carries roughly one-fifth of the world’s oil supply, but shipping activity has plummeted since the conflict intensified, contributing to volatile energy markets and rising global costs.
Fertilizer flows at risk
While energy markets have drawn the most attention, agricultural economists and analysts warn the implications for fertilizer could be just as significant.
Bloomberg’s Weilun Soon and Clara Ferreira Marques reported that the strait “has become a flashpoint” in recent weeks, with transits falling dramatically from normal levels. They noted that “a full blockade could halt the remaining flows and threaten economies far beyond the Middle East.”
That includes agricultural supply chains. News Nation’s Brooke Shafer reported that “it’s not just 20 percent of the world’s oil that travels through the Strait of Hormuz — it’s fertilizer, too. About one-third of the world’s fertilizer travels through the strait, according to the United Nations.” Shafer added that the disruption affects key nutrients used across global crop production: “That includes nitrogen fertilizers, which require liquified natural gas, and phosphate fertilizers, made from urea, ammonia and sulfur. Fertilizers are paramount to producing wheat, fruit, corn, rice and more.”
Prices already climbing
Fertilizer markets were already under pressure prior to the blockade. Additional global demand and supply constraints are compounding the issue. India recently issued a large import tender, while China is weighing restrictions on key inputs.
Bloomberg’s Julian Luk and James Attwood reported that “China has indicated it will halt exports of sulfuric acid from May, hitting metals and fertilizer industries already strained by raw material bottlenecks resulting from the Iran war.” They added that “sulfuric acid prices have been rising since the start of the Iran conflict,” in part because disruptions in the Strait of Hormuz have limited sulfur shipments from the Middle East.
For farmers, the convergence of higher fertilizer prices and rising fuel costs could significantly impact margins heading into upcoming planting and growing seasons.
Shafer warned that “this blockade could drive up prices for those fertilizers, which have already spiked by more than 40 percent from last year. Combined with gas and diesel costs, the price of producing food will skyrocket.” The uncertainty surrounding the blockade — and whether it expands or escalates — adds another layer of volatility for producers already navigating tight input supplies and fluctuating commodity markets.
Trump said he is monitoring fertilizer prices, while also signaling concern about domestic market dynamics.
“The United States will not accept PRICE GOUGING from the fertilizer monopoly!” Trump wrote in a social media post. “American Farmers, we have your back!”
Still, analysts note that global supply disruptions — not just domestic pricing — will play a major role in determining where fertilizer markets head next.
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