Fertilizer market in April 2026

The global fertilizer market is currently facing its most severe disruption since 2022. While the sector has been under pressure for quite some time, developments over the past few weeks have pushed the market into a new phase of uncertainty. A combination of geopolitical tensions, disrupted trade routes, elevated energy prices, restricted export volumes and rising logistics costs is creating a highly unstable environment.

This situation does not only affect producers, distributors and growers. It affects the entire food chain. Fertilizers remain a vital link between energy, crop production and food security.

The market was already under pressure before the recent escalation

To understand the seriousness of the current situation, it is important to note that the fertilizer market entered 2026 in an already tense position. In many segments, prices were already above the levels seen one year earlier, and market sentiment was clearly leaning towards further upward pressure rather than correction.

One of the main reasons was China’s export policy. China has traditionally played a major role in stabilizing global phosphate markets, but export volumes declined significantly in 2025. In addition, the country made clear that urea exports would remain restricted in order to prioritize domestic food security. While understandable from a national perspective, this has left a substantial gap in the global supply balance.

At the same time, Europe has continued to face relatively high natural gas prices. This remains highly relevant for nitrogen fertilizers such as urea, ammonia and UAN, as natural gas is a key feedstock in production. As a result, European production capacity has remained below normal levels.

In short, the market was already vulnerable. The events of late February and March have only intensified that fragility.

Why the Gulf region is so important to the fertilizer industry

The Strait of Hormuz is widely known as a strategic route for oil and gas. What is less widely understood is how critical the same corridor is for the global fertilizer trade.

The Gulf region combines three strategic advantages: abundant natural gas reserves, well-developed industrial infrastructure, and direct shipping access to some of the largest agricultural import markets in the world, including India, Brazil and North Africa. Countries such as Iran, Saudi Arabia, Qatar, the UAE and Kuwait therefore play a central role in the export of urea, ammonia, sulphur and phosphate-related raw materials.

Sulphur deserves particular attention. It is not only an essential nutrient for crops, but also a critical raw material in the production of sulphuric acid. That acid is required to convert phosphate rock into plant-available phosphate fertilizers. In other words, disruptions in sulphur supply do not only affect direct trade flows, but also phosphate fertilizer production worldwide.

A significant share of global seaborne trade in urea, sulphur, ammonia and phosphates passes through the Strait of Hormuz. When that route is disrupted, the effects are felt immediately across international markets.

The market shifted rapidly at the end of February

The recent escalation in the Middle East has had an immediate impact on fertilizer markets. Disruptions to shipping routes in and around the Gulf quickly translated into higher prices, supply concerns and greater uncertainty in procurement and delivery planning.

What followed was not only a response to actual supply disruption, but also a strong risk-based reaction from the market. Once producers, traders and buyers begin to price in uncertainty around availability and logistics, price formation changes rapidly. That is exactly what we are seeing today.

The impact is broader than physical shipments alone. LNG-related disruptions have also affected nitrogen production outside the Gulf, especially in markets dependent on imported gas. This has turned the current situation into a wider supply chain issue rather than a purely regional event.

What are prices doing?

Price increases are broad-based and affect several fertilizer groups at the same time. That makes this disruption fundamentally different from a temporary movement in just one nutrient market.

Urea has been the most affected product so far. In several markets, prices have risen sharply compared to pre-escalation levels. Ammonia has also moved significantly higher. DAP and MAP have followed the same direction, partly because of tightness in sulphur supply and the indirect impact on phosphate production outside the Gulf. Sulphur itself was already trading at elevated levels earlier this year and has now become even more difficult to source.

Potash has been relatively less affected, mainly because its supply base is less directly dependent on the Gulf region. Even so, the wider uncertainty in energy, freight and global trade continues to influence sentiment across all fertilizer markets.

For growers and distributors, this means that input costs have changed considerably in a short period of time. In markets with tight margins, this directly affects purchasing decisions, application strategies and timing.

Why this crisis is heavier than earlier market disruptions

What makes the current situation especially challenging is the combination of multiple risk factors at the same time.

The market was already dealing with restricted Chinese exports, expensive European gas, and tightness in several raw material segments. On top of that, the recent geopolitical escalation has introduced additional freight pressure, higher insurance premiums, logistical uncertainty and renewed volatility in procurement.

CBAM-related cost pressure within the European Union is also adding to the overall complexity. That means the market is not responding to one single event, but to a stack of structural and short-term pressures happening simultaneously.

Weather remains another important variable. If reduced fertilizer availability or higher prices are combined with difficult growing conditions in major agricultural regions, the impact on crop performance becomes even more significant.

Three possible scenarios for the rest of 2026

Looking ahead, three broad scenarios appear possible.

In a positive scenario, diplomatic efforts succeed in easing tensions and major shipping routes reopen more fully in the short term. If that happens, fertilizer prices may partially correct during the second half of the year, although a full return to previous levels remains unlikely.

The most realistic scenario at this stage appears to be partial normalization. In that case, trade continues, but under higher costs, tighter conditions and ongoing uncertainty. Prices would then remain structurally above pre-crisis levels, with higher freight, insurance and raw material costs built into the market.

In a more negative scenario, disruptions continue for a longer period and production infrastructure in the region comes under further pressure. That would likely lead to another sharp upward move in prices and a growing risk of physical supply shortages in several markets.

What this means in the longer term

Regardless of which scenario unfolds, one conclusion is already clear: this crisis will accelerate structural change in the global fertilizer market.

Countries and regions that depend heavily on one supply origin will increasingly focus on supplier diversification, local production and supply security. Within Europe, discussions around strategic fertilizer resilience are likely to intensify further.

In the longer term, alternative production routes such as green ammonia may gain momentum. However, these are medium- to long-term developments. They will not solve the immediate market imbalance. In the short term, the industry remains highly dependent on geopolitical stability, energy pricing and the availability of global logistics capacity.

Our view on the current situation

At present, the fertilizer market is being driven not only by confirmed supply disruptions, but also by uncertainty. That makes the current environment especially difficult to navigate. A sudden de-escalation could trigger equally sharp price corrections. However, as long as uncertainty around the Strait of Hormuz and wider regional developments remains in place, upward risk continues to outweigh downward potential.

For producers, distributors and professional end users, this means flexibility, timing and clear communication are more important than ever. Market conditions may change quickly, and purchasing decisions increasingly need to take raw material volatility, freight movements and delivery uncertainty into account.