By Michael Deliberto
The ongoing conflict in the Middle East has created volatility in fertilizer prices. While the duration of the conflict is hard to predict, the prolonged rise in energy prices (crude oil and natural gas) can have an impact on the price that U.S. agriculture producers pay for fertilizer. In turn, this can impact farm profitability at a time when margins are razor thin.
The Fertilizer Institute noted that 65% of overall U.S. agricultural nitrogen (N), phosphate (P), and potassium (K) needs are sourced by domestic production. However, the remaining 35% is supplemented by imports. Measured as the percent of imports relative to consumption, the U.S. imports 6% of its N needs- mainly from Trinidad and Tobago and Canada; 13% of its P needs from Peru and Morocco; and 94% of its K needs from Canada, Russia, Belarus, and Israel (Monaco, Schnitkey, and Paulson, 2025). Therefore, exposure to the global fertilizer market can lead to significant price volatility when geopolitical conflicts arise.
By examining fertilizer and fuel costs associated with corn, cotton, rice, and soybean production in Louisiana, a comparison is made between early January and mid-March prices. The early-January fertilizer and farm diesel expenditures were revisited by using the March 13, 2026, USDA AMS Alabama Production Cost Report’s diesel price and average bids for urea, DAP, and potash fertilizers. The price increase varies across nutrients, with N (urea) increasing by 27%, followed by K (potash) at 10%. Interestingly, DAP (P) declined but did show a relatively large price range ($756 to $1,075 per ton) in the weekly USDA report. Fuel prices increased from $2.85 to $4.04 per gallon, a $1.19 (42%) increase.
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