Fertilizer prices are rising sharply on the world market in a short period of time, and the consequences are directly impacting European agriculture. The triggers include the closure of the Strait of Hormuz, the production outage at the Ras Laffan plant in Qatar, high import taxes on Russian fertilizers, and the CBAM CO2 import tax. As a result, large quantities of urea and other nitrogen fertilizers are in short supply, while prices for upcoming deliveries continue to climb. In the Middle East, urea costs $650 per ton fob for March and already $750 for April. Since mid-February, this represents an increase of approximately $300 per ton, or 66 percent. For European farmers, this means higher operating costs, reduced fertilizer use, altered cropping plans, and growing risks to yields and supplies. (agrarheute: 18.03.26)
Fertilizer prices are driving Europe’s agricultural market into a new crisis
A third of global fertilizer trade passes through the Strait of Hormuz. Because this route remains blocked, urea, gas, and oil are no longer reaching many customers in the usual quantities. This immediately tightens supply, especially since Iran alone accounts for 10 to 12 percent of global urea production.
At the same time, the situation in Qatar has worsened. The plant in Ras Laffan, one of the world’s largest nitrogen plants, reported a force majeure shutdown on March 2nd. The Gulf region and the Middle East are crucial markets, however, as they account for 34 to 50 percent of global urea trade and 25 to 35 percent of nitrogen fertilizer trade. If supplies are disrupted there, prices on global markets will quickly rise.
Farmers are reducing fertilizer use and changing their cropping plans
Europe is heavily reliant on fertilizer imports, which is why the current market fluctuations are having a particularly severe impact. In France, reported import prices for urea are already around €650 per ton, delivered loose from La Pallice. Because fertilizer prices in the Middle East continue to rise, an increase to €700 per ton or more is considered realistic in Europe as well.
Many farmers are already responding with concrete reductions in their application. They are applying less nitrogen, reducing the areas sown with corn and wheat, or switching to crops with lower nutrient requirements. Corn, in particular, is losing its appeal because it is heavily reliant on fertilizer. According to forecasts by S&P Global CERA, Italy’s corn acreage is expected to fall to around 480,000 hectares in the 2026/27 marketing year, down from 541,000 hectares the previous year. Declines are also anticipated for Poland, France, and Spain.
Warnings of shortages in spring 2027 are growing louder
The consequences extend far beyond arable farming. In the animal feed sector, market participants are partially replacing maize with feed wheat because the profitability of the crops is shifting. Thus, the fertilizer shock is not only changing production, but also demand and pricing along the entire supply chain.
At the same time, traders are already looking ahead to spring 2027. One trader operating in the Benelux region described the situation as a “perfect storm” of rising costs, low grain prices, and a sudden increase in nitrogen prices. The warning from a major British fertilizer importer was particularly stark: “Europe will have no more nitrogen fertilizer in spring 2027… This message must reach the EU governments.” This puts not only the next growing season at risk, but also a part of Europe’s food security.