Farmers heading into another fertilizer-buying season are facing a market where the only constant may be uncertainty.
Geopolitical turmoil continues to shape global fertilizer supply and demand, but its impact varies sharply among nitrogen, phosphorus and potash. Meanwhile, sulfur has emerged as an unexpected pressure point for phosphate availability.
“The thing that has stayed the same is that geopolitics continue to be the biggest factor driving global fertilizer markets supply and demand,” says Corey Rosenbusch, CEO of The Fertilizer Institute. “What has changed is how those forces are affecting each nutrient.”
China Could Reshape Nitrogen Markets
One of the biggest potential shifts is China’s decision to re-enter the global fertilizer market. But that return is not expected to look the same across all fertilizer products.
As of September, market participants still lacked clear guidance on whether China would resume significant exports of DAP and MAP, according to S&P Global. Some traders expected phosphate exports might not resume at all in 2026.
Nitrogen could be a different story.
China produces nearly half of the world’s phosphate and about one-third of its nitrogen. After years of tight export restrictions, the country appears to be easing its stance, particularly on urea.
“We think they’re going to come back into the market in a pretty big way with their urea here into the future,” Rosenbusch says, pointing to reports that Chinese urea production has increased roughly 30%.
Rosenbusch says he doesn’t know exactly what is driving the production increase, but a significant return of Chinese urea to global markets could change the supply-demand balance and potentially provide some relief from the tight nitrogen markets farmers have faced for several years.
Sulfur Creates a New Phosphate Problem
Phosphate markets face a different challenge, and sulfur has become an increasingly important part of the story.
Sulfur may not be top of mind when farmers think about fertilizer availability, but it is essential to manufacturing MAP and DAP. Producing those fertilizers requires three key ingredients: phosphate rock, ammonia and sulfuric acid.
The problem is the cost of sulfur.
Ongoing disruptions in the Strait of Hormuz tightened sulfur supplies and sent prices sharply higher. Roughly half of the world’s traded sulfur has historically moved through the region, Rosenbusch says. At one point, he notes, sulfur prices reached $1,300 per metric ton.
That price might work for industries using sulfur to produce higher-value products, but it doesn’t work well for phosphate fertilizer manufacturing.
“It doesn’t make sense for $1,300 sulfur to make MAP and DAP at $700,” Rosenbusch explains.
As a result, some phosphate production has been idled around the world. Analysts estimate global phosphate production could decline by as much as 30 million metric tons next year if producers continue to struggle with the cost and availability of sulfuric acid.
Importantly, Rosenbusch says the problem isn’t that the world is running out of sulfur.
“This is not a supply issue,” he says. “It is a cost of production issue.”
A stable, open Strait of Hormuz would ease some of the pressure, but it would not provide an immediate fix. Oil and gas infrastructure in the region sustained damage during the conflict with Iran, and some production could take months or even years to recover.
More U.S. Production Won’t Mean Cheaper Fertilizer Overnight
Against that volatile backdrop, the U.S. is pushing to expand domestic fertilizer production.
Rosenbusch points to recent developments that include groundbreaking ceremonies for a new ammonia and phosphate facilities in Louisiana, along with a $500 million USDA program designed to encourage additional domestic production.
Those investments could strengthen the U.S. fertilizer supply chain. But farmers shouldn’t expect them to quickly translate into lower prices at the local elevator.
Fertilizer manufacturing is extraordinarily capital-intensive, notes Rosenbusch. A new ammonia plant can cost $4 billion to $5 billion, and new facilities can take years to build and reach full production.
There’s another important consideration: Even fertilizer produced in the U.S. is still part of a global market.
“Just because you’re producing more here [in the U.S.], you’re still going to be in line with whatever global market prices are,” Rosenbusch says.
Potash Still Tied to Canadian Supply
Potash adds another layer to the market picture.
Belarusian potash is beginning to return to the global market following the lifting of sanctions. But Rosenbusch cautions farmers against assuming those supplies will replace the volumes the U.S. receives from Canada.
And while Belarusian product could provide another source of supply, it doesn’t necessarily mean a cheaper potash supply.
“It’s aligned with what the global market price is for potash,” Rosenbusch says, with transportation costs adding to the final price.
For U.S. growers, that means Canadian potash will remain an important part of the supply chain.
High Fertilizer Prices Change Buying Decisions
The global fertilizer market may seem far removed from farmers’ fields, but its effects are showing up in their fertilizer purchasing decisions.
Rosenbusch says he’s seeing what he calls “demand rationalization” as growers respond to elevated fertilizer prices and the difficult farm economics.
A recent Ag Economists Monthly Monitor provides a snapshot of how agricultural economists are viewing that uncertainty.
Forty-four percent of the economists surveyed in September recommend that farmers buy a portion of their 2027 fertilizer now and wait to price the rest. Another 28% recommend that farmers lock in most or all needs this fall. Just 11% would advise farmers to hold their cash and wait for potential spring pricing.
That split reflects the uncertainty surrounding where fertilizer prices are headed. The largest share of ag economists — 35% — cited their expectations for fertilizer prices between now and next spring as the primary reason behind their buying recommendation.
Most don’t expect a price decline. Thirty-nine percent of the economists expect wholesale fertilizer prices next spring to be modestly higher, while another 33% expect prices to remain approximately where they are now.
For nitrogen, the numbers provide another useful benchmark. Nearly 43% of the economists expect spring 2027 anhydrous ammonia prices to average between $800 and $860 per ton in their region, while 57% expect prices between $950 and $1,150. For comparison, USDA Agricultural Marketing Service data put the average anhydrous price at $945 per ton for the week ending Oct. 2.
Fertilizer Is Needed, But Other Inputs Are Also Costly
The concern is particularly acute with phosphorus and potash. Farmers can draw on residual nutrients in the soil for only so long, notes Rosenbusch. After years of high fertilizer prices and reduced applications, he believes some growers are reaching the point where they need to replenish nutrients that have been removed with the crop.
“We’ve really mined any residual P from the soil,” he says.
That puts another strain on row-crop operations already dealing with high costs for diesel, interest, equipment and land.
Ultimately, Rosenbusch says the fertilizer equation cannot be separated from the commodity-price equation.
“We really need to get higher commodity prices,” he says. “Otherwise, farmers are not going to be able to sustain their input costs at this level.”
Know What’s Behind the Price
With so many variables moving at once, Rosenbusch says farmers need a better understanding of what is happening in fertilizer markets — and why.
That starts with conversations with agricultural retailers, he contends. If the answers aren’t clear, he encourages growers to seek additional information.
“The production side is fairly transparent,” Rosenbusch says. “What’s not clear is all of the steps that it goes through after the manufacturer sells it to get to the grower,” he adds.
Rosenbusch recently spoke with Andrew McCrea, host of Farming the Countryside, about the challenges in the fertilizer industry and his outlook for the near term. You can watch their discussion at the link below:
