Global oil i gas prices skyrocketed after the U.S. attack on Iran last weekend. But another key global supply chain is also at risk, one that could directly impact U.S. farmers who have already been oppressed by tariff wars for months. Conflict in the Middle East is choking global fertilizer supplies just before the crucial spring sowing season.
“It literally couldn’t be happening at a worse time,” says Josh Linville, vice president of fertilizers at financial services company StoneX.
The global fertilizer market focuses on three main macronutrients: phosphates, nitrogen and potash. They are all produced in different ways, and different countries lead in exports. When deciding which of these types of fertilizers to apply to their fields, farmers consider many factors, including crop type and soil conditions.
Potash and phosphates are extracted from various types of natural deposits; Nitrogen fertilizers, on the other hand, are produced from natural gas. QatarLNG, a subsidiary of Qatar Energy, the state-owned oil and gas company, said on Monday it would halt production following drone attacks on some of its facilities. As a result, almost one fifth of the world’s natural gas supplies were disconnected from the grid, causing gas prices to skyrocket in Europe.
The interruption in supplies particularly threatens the supply of urea – a popular type of nitrogen fertilizer. On Tuesday, Qatar Energy said this would also be the case discontinue the production of further productsincluding urea. Qatar was the second largest exporter of urea in 2024 (Iran was the third largest, and is also a key exporter of ammonia, another type of nitrogen fertilizer). Prices for urea sold in the U.S. from Up-to-date Orleans, a key cargo port, rose nearly 15 percent on Monday from last week, according to data provided by Linville to WIRED. Blocking the Strait of Hormuz also prevents other countries in the region from exporting nitrogen products.
“When we look at ammonia, we see that almost 30 percent of global production is involved or at risk,” says Veronica Nigh, senior economist at the Fertilizer Institute, a U.S. industry advocacy group. “It’s even worse when you think about urea. It’s almost 50 percent urea.”
Other types of fertilizers are also at risk. Saudi Arabia, Nigh says, supplies about 40 percent of all U.S. phosphate imports; taking them out of the equation for more than a few days could create a “really difficult situation” for the US. Other countries in the region, including Jordan, Egypt and Israel, also play an crucial role in these markets.
“We are already hearing reports that some Gulf producers are pausing production because they say, ‘I have limited space for my shipments,’” Linville says. “‘Once I hit the peak, I can’t do anything else. So I’ll stop production to make sure I don’t go beyond that level.'”
The conflict in the strait escalated earlier this week when the Islamic Revolutionary Guard Corps reportedly threatened any ship passing through the strait. Traffic slowed to a standstill. The Trump administration announced initiatives Tuesday to protect tankers transiting the strait, including providing maritime escort. Even if these initiatives are successful – which is the case in the shipping industry expressed doubts— much of the initial energy will likely go toward moving oil and gas assets out of the region.
“Fertilizers will not be the most valuable thing that will flow through the strait,” Nigh says.