The World Bank Group's Fertilizer Price Index showed that fertilizer prices increased by 12 percent in the first quarter of 2026. It also indicated that there was an increase for the sixth time in the last seven quarters. This is higher than in October 2022.

The World Bank's recently released 'April 2026 Commodity Markets Outlook' report states that the main reason for the disruption in supply due to the closure of the 'Strait of Hormuz' due to the Iran-Israel war is the main reason. While the price increase of other fertilizers has been relatively moderate, the price of urea has increased the most.

The current price increase is much lower than the sharp rise seen in 2021 and 2022. The report notes that while the price pressures are not as severe as in 2021-2022, the purchasing power of farmers for fertilizers has weakened sharply, raising concerns about food production, agricultural resilience and food security.

Northern Hemisphere farmers have already secured most of their fertilizer supplies, the price of natural gas (a key cost of nitrogen-based fertilizer production) has not risen as sharply as it did after Russia invaded Ukraine, and trade shipments from West Asia have gradually shifted to land routes.

The fertilizer price index is projected to increase by more than 30 percent in 2026, driven by rising production costs for nitrogen and phosphate-based fertilizers and continued strong global demand. Prices are expected to decline in 2027 as exports improve and new supplies become available. However, fertilizer prices are projected to remain high throughout 2026 due to persistent high energy prices and transportation and production disruptions linked to the Strait of Hormuz. The resurgence of global fertilizer prices is likely to have a direct impact on millions of farmers around the world.

Urea prices have surged by 80 percent since February to above $850 per tonne. This is the highest price increase since April 2022. DAP prices have risen as sulfur costs have doubled and export restrictions have tightened supplies. Despite the increase in potash prices, the market is relatively well supplied.

Hormuz is an important transportation route for nitrogen-based fertilizers produced in West Asia. With the closure of the Strait of Hormuz, fertilizer exports from West Asia have almost come to a standstill. This has had a direct impact on global supply and prices.

Amid the ongoing volatility in global markets, urgent action is needed to protect farmers and safeguard the global food system. Strengthening supply chains, supporting trade routes and increasing investment in agricultural productivity are critical, the report states.

According to the International Fertilizer Association, West Asia accounts for about 25 percent of total global exports of urea, the world's most widely used fertilizer. West Asia also accounts for more than 15 percent of global exports of ammonia, the main raw material required for urea production. It is also said that the suspension of exports from the main supplier region has increased the risk of agricultural costs becoming more expensive worldwide.

Iran has completely shut down its ammonia production amid the conflict, while Qatar's production of urea, ammonia and sulfur has been suspended after damage to key industrial infrastructure. India has also cut urea and ammonia production due to a decline in liquefied natural gas supplies. The market is further worried due to the tightening of exports and tight supplies from the world's leading producer China.

The price of fertilizer in the international market has increased sharply due to the all-round crisis. As a result, the purchasing power of fertilizer for farmers has reached its weakest level since mid-2022. That is, chemical fertilizers have become more expensive. The price of DAP fertilizer, which was stable at the beginning of 2026, has increased by more than 10 percent in April. The price has increased due to the tight supply of fertilizer in the market and a sharp increase in production costs.