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Global fertilizer markets are once again at a turning point. Although the reopening of the Strait of Hormuz has eased immediate geopolitical concerns, supply chains remain exposed to disruption as policy shifts, production costs, and climate risks continue to reshape fertilizer availability and pricing.
For Africa, a continent that imports most of its fertilizer, this volatility presents both a challenge and an opportunity. By strengthening regional production, expanding intracontinental trade, and improving market coordination, Africa can use this disruption as an impetus to build a more resilient fertilizer ecosystem.
Strait of Hormuz: Stability Returns, but Risks Persist
The reopening of the Strait of Hormuz has restored confidence to international fertilizer trade after months of uncertainty. As a critical shipping route for fertilizers and feedstocks from Iran, Qatar, Saudi Arabia, and the United Arab Emirates, the strait is central to global supply.
Iranian urea exports have resumed, easing shortages that had supported higher prices. Although exports have resumed, market participants remain cautious as geopolitical tensions in the region continue to pose risks to supply security and shipping confidence. Lower freight costs and improved vessel availability have also softened international urea prices. However, while logistics have stabilized, fertilizer markets remain uneven, and individual nutrients are reflecting different supply fundamentals.
Market Analysis
Urea: Supply Recovery Lowers Prices
Global urea prices are declining as improving supply and cautious purchasing continue to outweigh demand. The return of Iranian exports, coupled with China’s gradual increase in urea shipments following eased export controls, has improved product availability across international markets.
Combined with subdued seasonal demand, these developments have pushed prices lower, particularly in Asia, as buyers anticipate further corrections and stabilized inventories.
Phosphates: High Production Costs Keep Prices Firm
Phosphate fertilizer prices remain elevated despite softer demand. The main constraint is no longer transportation – it is production economics.
Sulfur, a critical feedstock for phosphoric acid production, still has an exceptionally high price, raising manufacturing costs and discouraging producers from expanding output. As a result, diammonium phosphate (DAP) and monoammonium phosphate (MAP) supplies remain tight, keeping prices firm despite cooling demand.
The contrast between urea and phosphates highlights a structural shift: costs of raw material, especially sulfur, are becoming a more important driver of fertilizer affordability than logistics.
Policy Shifts Reshaping Trade
Government policies are increasingly influencing fertilizer markets.
At the end of June, the United States suspended anti-dumping duties on Moroccan phosphate fertilizer imports for eight months, improving Morocco’s competitiveness and increasing global phosphate trade liquidity. The move also reinforces Morocco’s strategic role in global phosphate supply.
China’s fertilizer export policy has become one of the most influential drivers of global nitrogen markets. After maintaining strict export controls to safeguard domestic food security, the country has gradually expanded urea exports as inventories improved and production remained stable. The gradual return of Chinese exports has contributed to improved global urea availability and has added downward pressure on prices.
These developments demonstrate that government policy is as influential as production levels in shaping fertilizer markets.
Turning Crisis into Opportunity for Africa
Africa remains highly vulnerable to fertilizer disruptions because of its dependence on imports, limited domestic production, fragmented markets, and high transport costs. Yet current market conditions create an opportunity to strengthen long-term resilience.
Priority actions include:
- Expanding regional fertilizer manufacturing by leveraging natural gas reserves, phosphate deposits, and existing production capacity in countries such as Algeria, Egypt, Morocco, Nigeria, and South Africa.
- Strengthening intra-African fertilizer trade through the African Continental Free Trade Area (AfCFTA) to reduce dependence on distant suppliers.
- Investing in blending facilities, storage infrastructure, and coordinated procurement to improve supply security.
- Enhancing regional market information systems and early warning mechanisms to improve procurement planning and policy responses.
- Promoting soil health, balanced fertilizer use, precision agriculture, and integrated soil fertility management to improve fertilizer efficiency and productivity.
Rather than treating fertilizer solely as an imported commodity, Africa can reposition it as a strategic agricultural input supported by regional production, trade, and innovation.
Climate Risks Reinforce the Need for Resilience
As these market developments are happening, concerns over the emergence of El Niño conditions are growing.
Recent discussions within the Global Fertilizer Crisis Response Group highlight how emerging climate risks could coincide with fertilizer market volatility, compounding risks to agricultural production. These risks include potential disruptions to rice production in China due to low reservoir levels and delayed monsoon rainfall, as well as increased drought across the Horn of Africa, India, Indonesia, and parts of Central America.
For Africa, these warnings are significant. The Horn of Africa remains vulnerable to prolonged weather extremes that could reduce crop production while fertilizer affordability remains under pressure. Climate variability, combined with volatile fertilizer markets, reinforces the need to strengthen supply resilience before future shocks emerge.
Regional fertilizer security is therefore no longer only an economic priority – it is also a critical component of climate adaptation and food security.
Looking Ahead
The reopening of the Strait of Hormuz has eased immediate logistical pressures but has not eliminated the structural vulnerabilities facing global fertilizer markets. Urea prices are falling as supply improves, while phosphate markets remain constrained by high sulfur costs. Meanwhile, policy decisions by major producing and exporting countries continue to reshape global trade.
For Africa, these developments should be viewed not simply as another external crisis but as an opportunity to accelerate regional production, deepen continental trade integration, and strengthen fertilizer systems so they can withstand future geopolitical and climate-related shocks.
As the risks associated with El Niño intensify and global market uncertainty continues, Africa’s long-term agricultural security depends not only on ensuring access to fertilizer, but also on building a diversified, regionally integrated, and climate-resilient fertilizer ecosystem that is less vulnerable to external disruptions.
Disclaimer
This analysis is based on information compiled from publicly available sources and market intelligence. While every effort has been made to verify the accuracy of the information, the authors and publishers accept no liability for any loss, damage, or disruption caused by errors, omissions, or the use of this information.
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