Shares of CF Industries (NYSE:CF), Nutrien (NYSE:NTR), and Mosaic (NYSE:MOS) have surged between 5% and 35% since January, outpacing the benchmark S&P 500 Index, as the U.S.-Israeli strikes on Iran threw the world’s most critical fertilizer supply chain into disarray.
The Strait of Hormuz, through which roughly one-third of global fertilizer trade passes, sits at the center of the crisis. And with the Northern Hemisphere spring planting window opening now, analysts say the consequences could extend well beyond trading floors.
“Fertilizer markets have already reacted quickly, with prices rising roughly 30% in less than two weeks since the conflict began,” Hunter Swisher, CEO of agricultural technology company Phospholutions, told Benzinga. “That kind of move reflects how interconnected the fertilizer system is with global energy production, raw material inputs, and shipping routes.”
A Chokepoint For More Than Oil
Gulf nations account for approximately 30% of globally traded urea, the world’s most widely used nitrogen fertilizer, and about 20% of ammonia, the feedstock from which urea is derived. The conflict has placed both supply lines and the natural gas feedstocks that underpin them under direct threat.
“Volatility in natural gas prices is translated into urea via ammonia, as we have already seen. Both large fertilizer importers and food-importing regions are vulnerable to fertilizer costs and availability,” Dr. Maksim Sonin, a Stanford-affiliated energy expert, told Benzinga.
The disruption is not limited to nitrogen. Nearly 50% of global sulfur exports also …Full story available on Benzinga.com
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