War in Iran Drives Up Fertilizer Prices and Chemical Company Profits
As the ground thaws and the weather warms up, farmers are getting ready to plant their fields for the 2026 season. For most conventional farmers—especially those planting corn—that involves applying fertilizer. But can they afford it?
Fertilizer prices have been high since March 3, when Iran closed the Straits of Hormuz in response to US missile strikes. This blocks the only way for ships to get from the Persian Gulf to the Gulf of Oman, the Indian Ocean, and the rest of the world. In addition to being a crucial oil and gas shipping route, 49 percent of global urea exports and 30 percent of ammonia exports originate in the Persian Gulf and are shipped out via the Straits of Hormuz. In addition, the world’s largest urea plant, located in Qatar, had to temporarily shut down because of damage to its natural gas supply.
Countries like India, which relies heavily on natural gas from the Persian Gulf to run its nitrogen-fixing factories, are facing actual supply shortages because of the blockade. Because the United States only imports 25 percent of its total fertilizer and 18 percent of its nitrogen, American farmers aren’t facing any shortages, only higher prices.
Because fertilizer is traded on a global market, prices for various fertilizers are 9 to 31 percent higher than they were in March 2025. Prices were higher for most fertilizers in the late summer and early fall of 2025, so this isn’t an unprecedented price jump.
Many farmers and agricultural lobbying groups believe that fertilizer companies are using the war as an excuse to raise prices. On March 13, an Iowa farmer filed a class action lawsuit against the major fertilizer companies, accusing them of “conspiracies to fix, raise, maintain, and/or stabilize prices for nitrogen fertilizer.”
In addition to the lawsuit, agricultural lobbying groups are asking the federal government to give farmers financial assistance, claiming that more subsidies are essential “to ensure a strong, reliable and affordable domestic food supply.” But Angela Huffman from Farm Action points out that every time the USDA increases farmer payments, input companies increase prices, and the farmers still struggle to make ends meet. So they ask for more money, and the cycle continues.
Kathryn Anderson of the Union of Concerned Scientists explains that farmers can drastically reduce their need for purchased fertilizer by adopting eco-agriculture practices like more diverse crop rotations, cover crops, and re-integrating livestock into cropping systems. Simply adding small grains and forage legumes to a corn-soybean rotation can reduce nitrogen fertilizer requirements by 91 percent—while increasing corn yields by 4 percent and soybean yields by 16 percent.
Transitioning to rotations that require little or no purchased fertilizer will help insulate farmers from volatile input prices, while also improving soil health. And there won’t be much opportunity for chemical companies to siphon profits away from farmers—which is probably why they never mention the possibility of reducing fertilizer use.
