Global Fertilizer Supply Chain Faces "Systemic Shock"

The global agrochemical market has recently suffered two heavy blows in quick succession, pushing the fertilizer supply chain to a dangerous tipping point. Russia has announced a one-month ban on ammonium nitrate exports; the Food and Agriculture Organization of the United Nations (FAO) has warned that shipping disruptions in the Strait of Hormuz could trigger a 15%–20% surge in global fertilizer prices in the first half of 2026.

This is no longer a mere energy or geopolitical incident, but a systemic shock spreading through the global agricultural system.

01 Russia Hits “Pause” on Ammonium Nitrate Exports

As a key player in the global fertilizer market, Russia recently announced a one-month suspension of ammonium nitrate exports, effective immediately until April 21. The decision was made by Russia’s Ministry of Agriculture, driven by the priority of securing domestic supply ahead of the spring planting season.

Russia holds a dominant position in global ammonium nitrate trade, controlling 40% of international trade volume and producing a quarter of the world’s total output. The export suspension freezes all issued export licenses and halts new license issuance, except for intergovernmental contracts.

The Ministry of Agriculture stated clearly: “Against rising global demand for nitrogen fertilizers, suspending external supplies will prioritize meeting domestic market needs during spring field operations.” This is not an isolated move. Since 2021, Russia has repeatedly imposed fertilizer export quotas and pressured producers to prioritize domestic supply. The one-month full suspension extends this policy—but its impact is greatly amplified amid already strained global supply chains.

02 The Strait of Hormuz: Fertilizer’s Chokepoint

If Russia’s export ban is a direct shock, the shipping crisis in the Strait of Hormuz represents a deeper structural risk.

FAO Chief Economist Máximo Torero’s warning at a UN briefing is not alarmist. Known as the “global jugular,” this maritime chokepoint controls not just oil, but the lifeblood of global fertilizer trade:

• Fertilizer lifeline: Nearly 30% of global fertilizer trade passes through the Strait of Hormuz.
• Critical feedstock shortage: Almost half the world’s sulfur trade—a key input for phosphate fertilizers—originates in the Persian Gulf. A supply cutoff would cripple phosphate production.
• Price explosion: In the first week of March alone, urea prices jumped 19% in the Middle East and 28% in Egypt.

This compounds Russia’s challenges. Russia confirmed that 24% of global ammonia trade (a core raw material for ammonium nitrate) has been cut off by Strait of Hormuz disruptions, and it cannot boost output to fill the gap this year.

03 Maritime Shipping in “Wartime Mode”: Premiums Adjusted Weekly

Torero added that ocean freight has entered classic “wartime mode,” with logistics costs soaring at an alarming rate:

• War risk surcharge: Skyrocketed from 0.25% to 10%.
• Pricing frequency: Insurers now reassess premiums weekly.

Even Iran’s partial shipping reopening for “friendly nations” including China, Russia, and India cannot offset exorbitant logistics and insurance costs. For fertilizer traders, “insurance costs exceeding cargo value” is no exaggeration—it is already reality.

04 Russia’s Domestic Supply Also Under Pressure

Beyond external supply chain disruptions, Russia’s domestic production is strained. In February, Ukrainian drones attacked the Dorogobuzh plant in western Russia—a core facility of Acron, one of Russia’s top ammonium nitrate producers, accounting for 11% of national capacity. Full production is not expected to resume until May.

Russia’s three major ammonium nitrate producers—Eurochem, Acron, and Uralchem—are now prioritizing domestic spring planting under government coordination.

Key export markets include Brazil, India, Peru, Mongolia, Morocco, and Mozambique. The U.S. also imported small volumes in 2024. The suspension will directly hit spring fertilization preparations in these markets.

05 Chain Reaction: How Much Will Crop Yields Drop Without Fertilizers?

FAO analysis warns that a fertilizer supply gap lasting more than three months will trigger three extremely dangerous global agricultural trends:

1. Non-linear yield collapse: The fertilizer-yield relationship is not proportional. When farmers cut applications due to high prices, yields do not fall proportionally—they may collapse. Nutrient shortages during critical growth stages hit yields far harder than the reduction in fertilizer use.

2. Crop shift: Farmers will abandon fertilizer-intensive wheat, rice, and corn for low-input crops like soybeans. This “crop migration” will create staple grain (especially cereal) shortages, while soybean expansion will squeeze food crop acreage.

3. Food-to-fuel conversion: Rising international oil prices boost biofuel demand, diverting more corn, sugarcane, etc., to ethanol/biodiesel production instead of food. The food-versus-fuel competition will further tighten global food supplies.

06 Expert Assessment: The World Has Changed

The FAO’s conclusion is cautious but grim: Even if conflicts cease immediately, restoring normal shipping will take months.

Worse, surging fertilizer and energy costs have already severely disrupted 2026 planting decisions. High fertilizer prices are reshaping millions of farmers’ plans, with impacts emerging in harvests this year and next.

As the FAO notes, while global grain reserves remain adequate, prolonged supply chain failures will trigger a systemic food security crisis. For the agrochemical industry, this is no longer just about price volatility—it is a critical moment to rethink supply chain resilience and major producer stability.

Russia’s one-month ammonium nitrate ban is an alarm bell: Amid Strait of Hormuz disruptions, production pressure in key origins, and sky-high logistics costs, global agriculture stands at a fragile crossroads.

In the coming weeks, spring planting progress, inventory drawdown rates, and fertilizer stockpiles in major importing nations will be key gauges of the shock’s depth.

Citation:

AgroPages. (2026, March 30). Global fertilizer supply chain faces “systemic shock”: Dual shocks from Russia’s ammonium nitrate export ban and Strait of Hormuz disruption. AgroPages. https://cn.agropages.com/News/NewsDetail---37380.htm