Impact of the Iran War on U.S. Fertilizer Prices and Agriculture

The ongoing conflict in Iran, particularly following the initiation of "Operation Epic Fury" on February 28, 2026, has led to significant disruptions in global fertilizer supply chains. The Strait of Hormuz, a critical maritime route through which approximately one-third of the world's fertilizer is transported, has effectively been closed, causing immediate price increases for fertilizers essential to U.S. agriculture. Reports indicate that prices for nitrogen fertilizers, such as urea, have surged by over 28% within weeks of the conflict's escalation, exacerbating an already strained agricultural sector.

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American farmers, already facing financial difficulties due to previous trade wars and rising operational costs, are now contending with skyrocketing fertilizer prices. For instance, John Yeley, a farmer from Illinois, noted that he could not secure reliable pricing for nitrogen sources, with costs rising so rapidly that he is forced to rely on a single supplier. The American Farm Bureau Federation's president, Zippy Duvall, emphasized that when farmers experience supply shortages or price hikes, the repercussions extend throughout the food supply chain, ultimately leading to increased grocery prices for consumers.

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Farmers are grappling with a combination of rising input costs, including fertilizer, energy, and equipment, while crop prices remain low. Chad Hart, an economics professor at Iowa State University, described the agricultural economy as being in a recession, with many farmers losing money on staple crops like corn and soybeans. The financial pressure has led to record-high farm debt levels, forcing many farmers to rely on federal assistance to remain afloat.

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The fertilizer crisis is expected to have a cascading effect on food prices. Experts predict that the increased costs of fertilizer will translate into higher expenses for growing crops, which could lead to a rise in grocery prices. For example, estimates suggest that the cost of growing an acre of corn could increase by $25 to $33, while soybeans could see an additional $11 to $12 per acre. This translates to significant financial burdens for farmers managing large-scale operations.

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The U.S. Department of Agriculture has already projected that food prices will rise more than in previous years, with the war in Iran compounding these challenges. The potential for reduced crop yields due to insufficient fertilizer access poses a serious risk to food security, particularly in regions heavily reliant on Gulf-sourced fertilizers.

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In response to the crisis, the White House has announced measures to allow the importation of Venezuelan fertilizer to alleviate supply shortages. However, the effectiveness of this strategy remains uncertain, as the production capacity of Venezuelan fertilizer is unclear. Additionally, the American Farm Bureau Federation has called for further government action to stabilize supply chains and mitigate the financial strain on farmers.

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As the situation evolves, the agricultural sector faces an uncertain future. The duration of the conflict and its impact on fertilizer supply will likely dictate the extent of the economic fallout for farmers and consumers alike. With the spring planting season underway, the repercussions of the Iran war on U.S. agriculture and food prices are poised to be felt for months to come.

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• “When I call a retailer right now … I could not get a price on any nitrogen source out there,” — John Yeley, Illinois Farmer

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• “The writing was on the wall that there was probably going to be an increase in fertilizer prices heading into the spring,” — Josh Boxell, Indiana Farmer

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• “The farmer’s really not seeing an increase in our goods sold, but everybody’s seeing the increase at the grocery stores,” — Josh Boxell, Indiana Farmer

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• “It’s pushing the older generation to say, ‘Why am I going to work my tail off and lose money,?’” — Randy Kron, Indiana Farm Bureau President

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While many sources agree on the rising costs of fertilizers and the impact on farmers, there is some discrepancy regarding the exact percentage increases and the projected long-term effects on food prices. Additionally, the effectiveness of government measures to alleviate supply issues remains uncertain, with no clear data on the potential volume of Venezuelan fertilizer imports.

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