International instability has led to a surge in international urea prices, with nitrogen fertilizers leading the price increases, followed by phosphate fertilizers, and potash fertilizers showing a steady rise.
Major global urea producers include China, India, Iran, and Russia, with Iran and Russia being the largest exporters.
Data shows that global urea exports are projected to reach approximately 50.8 million tons in 2025, with Iran exporting 7.8 million tons, accounting for about 15% of the global total.
Meanwhile, Qatar in the Middle East plays a crucial role in the global nitrogen fertilizer supply system.
Nearly one-third of the world’s urea and 44% of its sulfur are transported through the Strait of Hormuz. Restrictions on transportation through the Strait of Hormuz have resulted in the shutdown of urea plants in many countries.
This has disrupted the previously relatively balanced supply and demand relationship, causing urea prices to accelerate their rise starting in March of this year.
Taking the Arabian Gulf (Middle East/Persian Gulf) urea FOB price as an example, this price serves as the most crucial spot price reference in the global urea market, and its indicative role has been further strengthened, especially against the backdrop of the US-Iran conflict.
Since the escalation of tensions between the US and Iran on February 28th, the disruption of navigation in the Strait of Hormuz has significantly accelerated the rise in local urea prices.
This has driven up international urea, phosphate, and potash fertilizer prices to varying degrees.
The impact of the Middle East situation on potash fertilizer is mostly reflected in transportation costs. Due to the continuous rise in oil prices and marine insurance, shipping costs in most regions have increased by more than 100%.
Currently, the potash fertilizer market is affected by multiple factors, including global supply chain fluctuations, geopolitical factors, and seasonal changes in agricultural demand, resulting in prices that are more likely to rise than fall.
The Middle East situation has pushed up overseas fertilizer prices, but its impact on the domestic market has been very limited.
The stability of domestic fertilizer prices is due to several factors.
Firstly, there is a difference in raw material structure. Middle Eastern urea is almost entirely derived from natural gas, while domestic raw materials are mainly coal, with natural gas as a secondary source. Coal accounts for about 80% of domestic raw materials, making it less susceptible to shocks from the external energy market.
Secondly, since 2022, new domestic urea production capacity has been continuously released, leading to an overall increase in output.
Furthermore, March and April this year are a critical period for ensuring the supply of fertilizers for spring planting. Several listed companies have previously stated that they will “strictly implement the domestic fertilizer market supply and price stabilization policy to safeguard national food security.”
If you need to purchase urea or other fertilizer products, please contact us as soon as possible. Due to my country’s export restrictions, quantities are limited and available on a first-come, first-served basis.
