Reading time: 6 min
CF Industries hit a record close. Intrepid Potash touched a 52-week high. Bunge, ADM and Nutrien are all climbing. While every headline focused on $90 oil, the real trade of the week was in a sector most equity investors haven’t looked at since 2022: fertiliser.
Here is the number that matters and that almost nobody led with. Roughly one-third of globally traded urea moves through the Strait of Hormuz, according to CRU Group data cited by the Financial Times. The strait also carries about 45% of the world’s sulphur exports, a critical input for phosphate fertiliser production, and a significant share of globally traded ammonia. When Iran shut the strait, it didn’t just block 20 million barrels of crude per day. It severed the supply chain that underpins half of the world’s food production.
That is not hyperbole. Nitrogen fertiliser, synthesised from natural gas through the century-old Haber-Bosch process, supports approximately 50% of global crop yields, as Bloomberg’s Business of Food newsletter noted on Friday. Without it, harvests of wheat, maize and rice collapse. There is no strategic reserve for fertiliser. Oil has the SPR. Fertiliser has nothing.
What Broke This Week
QatarEnergy halted production of urea, ammonia, methanol and related products at Ras Laffan, the world’s largest LNG and industrial complex, after Iranian drone strikes hit the facility on Saturday. Iran’s own ammonia production went offline entirely. That is two of the biggest nitrogen sources on the planet, gone in a weekend.
Urea barge prices at the Port of New Orleans jumped from an average of $475 per ton last week to $520-$550 per ton by Monday, per CRU Group data reported by Farm Policy News. Argus Media, in a note picked up by Reuters, said the conflict threatened to choke supply from a region responsible for around 35% of global seaborne urea trade. Yara International, the Norwegian fertiliser giant, confirmed that European natural gas costs for fertiliser production nearly doubled in a single week, from $10.60 per million BTU last Friday to over $20 by Monday.
The timing, as Josh Linville at brokerage StoneX put it to Farm Progress, “couldn’t be much worse.” Northern Hemisphere spring planting begins now. Farmers in the US Corn Belt, across Europe and in South Asia are entering the narrow window when nitrogen application determines the year’s harvest. Delayed or reduced fertiliser use doesn’t show up in commodity prices for months. But it shows up in yields. And yields show up in bread prices.
Who’s Making Money
CF Industries Holdings, the world’s largest ammonia producer, surged as much as 8.3% to its highest level since late 2022 on Monday and kept climbing all week, according to GuruFocus. By Friday it was up approximately 17% for the week, hitting a fresh 52-week high and closing at a record. Barclays analyst Benjamin Theurer raised his price target on CF from $100 to $120, keeping an Overweight rating, arguing the strikes have the potential to support nitrogen pricing through at least the first half of 2026.
Intrepid Potash jumped 9% on Friday alone, also touching a 52-week high, with weekly gains near 17%, per CNBC. Earlier in the week, Mosaic rallied 3.1% and Nutrien added 2.4% on the initial Monday spike, though Nutrien’s full-week gain settled at a more modest 1%, according to GuruFocus. The S&P Composite 1500 Fertilizers and Agricultural Chemicals Index touched its highest level since July, Farm Progress reported.
It wasn’t just fertiliser producers. Bunge Global climbed 3.14% on Friday. Archer Daniels Midland added 1.37%. Soybean oil futures surged 3.9% to a two-and-a-half-year high on Monday as higher crude prices pulled biodiesel demand and vegetable oil markets higher, Bloomberg reported. Benchmark palm oil prices in Kuala Lumpur rose 1.6% in the same session. Aletheia Capital analyst Nirgunan Tiruchelvam pointed out that roughly 20% of global palm oil supply transits the Strait of Hormuz.
Put that in context. The S&P 500 Materials sector dropped 7% on the week, its worst performance since April. Tech got hammered. Banks bled. But a handful of fertiliser and agricultural input stocks delivered double-digit weekly gains while the Dow went negative for 2026. That doesn’t happen by accident.
Why This Is Different From 2022
The obvious parallel is 2022. Russia invaded Ukraine, fertiliser prices spiked, food inflation followed. Chris Lawson, head of CRU’s fertiliser division, pushed back on that comparison in comments reported by Futunn. The 2022 spike was severe, he said, but the market could adjust because Russian exports weren’t physically interrupted. Ships still moved. This time the obstruction is physical. The Strait of Hormuz is a chokepoint that cannot be rerouted, and unlike oil, there is no spare fertiliser capacity sitting behind it waiting to be released.
Scotiabank analyst Ben Isaacson went further in a client note covered by Farm Progress. Even if supplies eventually resume flowing through the strait, the cost of freight insurance has become “economically unviable.” That means the physical barrier outlasts any ceasefire. Iran controls 10-12% of the global urea trade directly. Israel’s declaration of a state of emergency could interrupt gas deliveries to Egypt, threatening Egyptian fertiliser production as well. StoneX data shows three of the world’s ten largest ammonia exporters and one in five top phosphate suppliers rely on Hormuz to get product to market.
The US is not immune. Russia and Qatar are the two biggest urea suppliers to America, according to the USDA. While the US doesn’t import much directly from Iran, significant volumes flow from other Middle Eastern countries through the strait. Farm Policy News reported that some farmers may shift acreage from corn to soybeans if nitrogen doesn’t arrive in the Corn Belt in time, a decision that would reshape the entire US agricultural season.
The Slow Shock
Most equity investors don’t trade fertiliser. That’s the edge and the problem. Oil prices change overnight. Petrol prices change within days. Fertiliser shocks take weeks to register in input costs and months to show up in crop yields, as The Conversation noted in an analysis published this week. By the time the impact reaches grocery shelves, the planting window has already closed.
Central banks are watching fuel. They should be watching fertiliser. That lag — the months between input shortage and harvest shortfall — is the trade. CF Industries, Intrepid Potash and Nutrien are pricing in what wheat and corn futures haven’t yet. If the strait stays closed through March, the fertiliser shock becomes a food supply shock. And food supply shocks, historically, correlate with social unrest in import-dependent economies from North Africa to South Asia.
The Dow is negative for 2026. Tech is under water. The VIX hit 28 on Friday, a four-month high. In the middle of all of that, a group of stocks that most portfolio managers last thought about during the Ukraine war just delivered the best weekly returns on Wall Street. That is the market telling you something about what it thinks happens next. Whether you listen is up to you.
