US farmers face fertilizer worth disaster as Iran battle disrupts world provide

Tennessee farmer Todd Littleton is facing an additional $100,000 bill for fertilizer this season, marking a 40 per cent increase from last year, a direct consequence of the war in Iran. He is now scrambling to find ways to cover this unexpected expense.

“The problem is, is we’re so strained financially coming into this issue,” explained Littleton, a third-generation farmer from Gibson County in the state’s northwest.

“We have had a couple of record losses over the last couple of years, so everyone’s kind of grabbing at straws anyway, and then to have input prices increase yet again, it just really couldn’t happen at a worse time.”

Littleton, who cultivates corn, soybeans, and wheat, is one of thousands of farmers nationwide who will pay significantly more this spring for the essential nutrients their crops require.

Nitrogen-based fertilizer is particularly crucial for corn, typically the largest crop in the U.S., which feeds the nation’s livestock and is converted into fuel for most U.S. vehicles.

While farmers have long voiced concerns over fertilizer costs, prices have surged dramatically since the U.S. and Israel attacked Iran on 28 February.

This action has caused a significant slowdown in shipping through the Strait of Hormuz, a critical choke point for 20 per cent of the world’s oil and natural gas.

Beyond driving up fuel prices, which are vital for fertilizer production, the shipping disruption has largely halted the export of nitrogen fertilizers manufactured in the Persian Gulf and restricted access to key fertilizer ingredients.

About 15 per cent of fertilizer imports to the U.S. are from the Middle East, and about half the global supply of the key ingredient urea comes from the region, along with 30 per cent of ammonia, according to the American Farm Bureau Federation.

“When the ports started raising their nitrogen prices due to the conflict due to shipping concerns, that directly affects me here on the farm,” Littleton said.

The extra costs are hard to absorb, coming after several bad years when crop prices were down even as expenses kept climbing, Littleton said.

But it could be worse, as some farmers may not be able to obtain fertilizer at any price, said Zippy Duvall, president of the American Farm Bureau Federation.

“We’re being told that many of our farmers that haven’t preordered their fertilizer and paid for it may not even obtain the fertilizer that they’re going to need during the season or for spring planting,” Duvall said. “That’s why this situation is so serious.”

Harry Ott, a cotton, corn and peanut farmer who also leads the South Carolina farm bureau, said there isn’t enough fertilizer stockpiled in warehouses to meet demand in the coming months.

“It is a really dire situation that our farmers facing,” Ott said.

Even before the latest price increase, other factors in the last several years have led to high fertilizer prices, starting with the war between Ukraine and Russia, which blocked access to raw materials and increased natural gas prices. China also cut phosphate exports as it focused more on domestic needs.

The latest factors worsened those existing supply issues, which means that even if the Iran war was resolved, fertilizer prices likely won’t quickly fall, said Jacqui Fatka, a farm supply economist for creditor CoBank.

“There’s going to be a tail to this to get everything turned back on, sent back out,” Fatka said.

And then there is the time it takes for shipments from the Middle East to reach the U.S. — typically 30 to 45 days to reach the Port of New Orleans.

Some fertilizer is already stored in the U.S. and can meet demand amid the shortage of Middle East imports, but at some point that supply will run short.

“We don’t quite know how it’s going to shake out,” said Nancy Martinez, director of public policy, trade and biotechnology for the National Corn Growers Association.

Nitrogen- and phosphate-based fertilizers are largely produced domestically, which helps a little bit, said Anne Villamil, a professor of economics at the University of Iowa.

“But again, energy prices are an input, and so even if you’re producing it in the U.S., if the cost of your inputs goes up, then it’s going to be an increase in price to the farmers who want to buy it,” Villamil said.

Soaring oil prices could result in higher food prices, given the increased cost of diesel needed to transport products to grocery stores and petroleum products used in plastic packaging, said Chad Hart, an economics professor at Iowa State University.

However, the increased fertilizer prices shouldn’t significantly lead to grocery store increases even as they put a crimp in farmers’ profits. That’s because on-farm costs are only a small part of what consumers pay at the supermarket.

The Trump administration said it has taken steps to ease the cost of fertilizer, including moving to increase fertilizer imports from Venezuela, which U.S. Agriculture Secretary Brooke Rollins called “a huge step that puts farm security and farmers first.”

The Department of Agriculture also notes it previously announced $12 billion in one-time payments to help farmers offset losses primarily due to tariffs imposed by the Trump administration. In a statement, the USDA also said it has provided more than $30 billion in additional aid to farmers since January 2025, and the agency noted its support for a more competitive fertilizer marketplace that would ultimately lower prices.

Fatka, of CoBank, said the $12 billion doesn’t go far for farmers with a payment of $44 per corn acre when the USDA estimates about $900 per acre for cost of production for the average U.S. farmer.

Still, farm bankruptcies remain rare, with only 315 last year — a tiny percentage of the nearly 1.9 million farms nationally. And prices for the nation’s two largest crops — corn and soybeans — have been climbing recently.

Tom Waters, who farms about 5,000 acres (2,023 hectares) of corn, soybeans and wheat east of Kansas City, said the increase of fertilizer prices along with other costs makes it tough to make a profit when crop prices are so low.

“The margins get smaller and smaller so we just have to really work hard to trim our costs and be as frugal as we can be but still provide the soil and crop what it needs to grow and produce,” Waters said.

Source: independent.co.uk