Iran tensions risk fertilizer flow to South American farmers

Fertilizer supplies to Southern Hemisphere agricultural powerhouses like Brazil and Argentina are at risk as a fragile ceasefire between the US and Iran frays just as planting season nears.

The flow of fertilizer ships entering the Persian Gulf — a region that accounts for about a third of global urea exports — has slowed to a trickle since late June as tensions began to rise again with a spate of Iranian attacks on vessels transiting the Strait of Hormuz.

Just four empty vessels booked to load fertilizer cargoes have transited the waterway into the Gulf since June 30, tanker tracking data compiled by Kpler and Bloomberg show. Two of those ships have recently loaded cargo but are yet to depart.


Pre-conflict, between 20 and 40 ships would typically load fertilizer from the broader Gulf region every week. That number has now fallen to around five ships, according to Serena Piazzo, dry bulk shipping market analyst with ship broker Ifchor Galbraiths.

“If this really is the end of the US-Iran ceasefire, it means that the fertilizer market’s biggest problem will be shipowner confidence,” she said. “If shipowners decide that transiting the Strait of Hormuz to load fertilizer cargoes is too risky, then these cargoes will not reach their international customers.”

The timing is especially sensitive, with forecasts of an exceptionally powerful El Niño pattern raising weather risks for farmers already buffeted by fertilizer disruptions and high energy costs from the Iran war. Brazil and Argentina are two of the world’s top crop exporters and damage to their agriculture business has a ripple-down effect on food prices around the world.

Brazil’s urea imports were down 32% in the first half of 2026 as “farmers delayed buying and shifted to other less costly nitrogen products during the height of the conflict,” said Alexis Maxwell, senior agriculture analyst with Bloomberg Intelligence. “With the ceasefire on shaky grounds at best, supply access to Middle East’s critical urea production looks farther afield, compounding Brazil’s bet on demand deferral.”

As the planting season for Northern Hemisphere growers ended and the Iran war appeared close to resolution, urea prices had erased their wartime premium by mid-June. Now, with Brazilian and Argentinian demand gathering pace, prices in New Orleans are edging up. Prices as of July 10 were at the highest in a month, after rising 6.2% from the prior week — the biggest jump in more than three months, according to Bloomberg Green Markets.

Dry bulk traffic through Hormuz has remained well below pre-conflict levels, despite a flurry of ships exiting in the initial days after the ceasefire. The subdued traffic suggests there is a smaller pool of vessels available to carry fertilizer cargoes.

That’s a reversal from the early days of the conflict, when dozens of vessels became stranded inside the Gulf. They were effectively acting as floating storage, allowing producers to keep operating. Now, as the US and Iran once again trade airstrikes, already wary shipowners are likely to be even more reluctant to transit Hormuz to load new cargoes.

“The constraints remain logistical and transportation, freight and marine insurance rather than production,” said Maria Antip, a fertilizer pricing analyst with Bloomberg Green Markets.