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FOB granular urea in Egypt was trading between $400 and $490 per metric tonne before the war. It is now around $700. Oxford Economics reported urea prices up roughly 50 percent and ammonia up 20 percent since February 28. CF Industries hit an all-time high on Monday, gaining nearly 10 percent in a week. You are watching crude at $104. The trade that will determine whether 45 million more people go hungry is printing on a fertiliser contract nobody on your desk is tracking.
A Third of Global Fertiliser Trade Just Disappeared
Approximately 30 percent of internationally traded fertiliser passes through the Strait of Hormuz. The FAO estimates that 3 to 4 million tonnes of fertiliser trade have been stalled per month since the strait effectively closed. Qatar, Saudi Arabia, Bahrain, and Oman are the primary exporters of urea, diammonium phosphate, and anhydrous ammonia. Natural gas is the feedstock for all of it, and gas prices are more than 50 percent above pre-war levels after Iran’s retaliatory strikes damaged Qatar’s Ras Laffan complex.
Here is the part your risk model probably does not account for: unlike oil, fertiliser has no strategic reserve. None. No international coordinating body. No government stockpile. No emergency release mechanism. When the IEA released 400 million barrels of crude within two weeks, that was possible because the infrastructure existed. Fertiliser has no equivalent. The supply stopped and the only available responses are to pay the new price or plant without it.
Sarah Marlow, global head of fertiliser pricing at Argus, told CNBC this crisis will have a bigger impact on fertiliser trade than the Russia-Ukraine war. Ninety One’s George Heyl said he is more concerned now than he was in 2022 because this disruption could hit agricultural yields across multiple geographies and major crops at the same time. CRU’s Chris Lawson confirmed the Middle East is a disproportionately large exporter of urea and nitrogen products. The Gulf was already being used to backfill losses from the Black Sea and from China’s phosphate export restrictions. Those backup routes are now cut too.
India Cannot Make Fertiliser. Thailand Cannot Ship Rice. Both Are Happening at Once.
Fertiliser plants in India, Bangladesh, and Pakistan have stopped production entirely because natural gas and feedstock costs blew through operating margins, according to Noah Gordon at the Carnegie Endowment. India imports nitrogen fertilisers and the natural gas needed to produce them domestically. That is double exposure to a single disruption. When your input cost and your import cost are both indexed to the same chokepoint, there is no hedge available.
On the other side of the trade, Asian agricultural exports that normally transit Hormuz to reach Gulf buyers have stalled. Two vessels carrying approximately 80,000 tonnes of Thai rice bound for Iraq were stopped at a Bangkok port. India’s agricultural exports to Gulf countries, including bananas, rice, and other products, have been cut dramatically. The Middle East imports most of its grain, oilseeds, and vegetable oil by sea. The same strait that blocks fertiliser going out blocks food going in. If you are running a soft commodities book, you now have a supply disruption on both the input and the output side of the same trade.
Southeast Asia’s exposure is structural, not cyclical. Agriculture accounts for roughly 10 percent of ASEAN GDP and a third of employment, per the Singapore University of Social Sciences. Imelda Bacudo at the FAO in Indonesia warned that fertiliser shocks are social and political events, not just market ones. The fuel rationing already underway across the region is about to be joined by food inflation driven by the same war and the same chokepoint.
The Planting Window Closes Whether the War Ends or Not
Fertiliser is applied early in the crop cycle. It determines yields for the rest of the season. UNCTAD’s Frida Youssef told UN News that it is spring planting season right now, the window when farmers purchase fertiliser for the next harvest. If they cannot secure supply or if prices are prohibitive, yields fall. The World Food Programme has warned that 45 million additional people could be forced into acute food insecurity in 2026 if the war continues.
The FAO flagged the risk of cross-commodity price contagion. Higher fertiliser costs raise the cost of growing corn, wheat, soybeans, and rice. Higher fuel raises the cost of moving those crops. Higher insurance raises the cost of shipping them. Ninety One’s Heyl estimated that a hypothetical 5 percent reduction in agricultural yields would not cause starvation but would cause meaningful food inflation, with emerging market countries absorbing the worst of it. Sudan and Bangladesh source more than half their fertiliser from the Gulf. China could respond by restricting its own fertiliser exports, a move it has made before with phosphate, which would compress global availability further.
The Globe and Mail reported that even if the war ended today, the fertiliser shortage would persist for months. Restoring Qatar’s gas production takes time. When it comes back online, fertiliser manufacturing will not be the priority because LNG sells at a higher margin, especially to Asian buyers desperate for energy. The supply chain from gas well to urea granule to farm gate involves lead times measured in months. Spring planting does not wait for geopolitics to resolve itself.
What This Means for Your Book
CF Industries is at an all-time high. The rest of the nitrogen complex, from Nutrien to Mosaic, is positioned to reprice in a market where a third of global trade has been removed. If you are long nitrogen producers outside the Gulf, the war is a tailwind that has barely been priced. If you are short soft commodities on the assumption that food stocks entered 2026 at comfortable levels, the buffer is thinner than it looks. Heyl at Ninety One noted that markets entered the year with fairly high stocks of basic food commodities, but those stocks assumed normal fertiliser deliveries. Normal is not available.
Rice is the commodity that connects the disruption to the largest number of people. It is the staple across South and Southeast Asia, where the poorest households spend half their budget on food. Even small price increases have disproportionate effects on food security, nutrition, and political stability in a region already running on emergency measures. Your crude screen says $104. The price that will move more people than any barrel of oil is the one on a tonne of urea at an Egyptian port. Watch that number. It is not on most dashboards. It should be.
For a complete timeline of how the Iran war reshaped global markets, see our reference page.
