Sellers retain fertilizer pricing power into 2027
The guest argued that global fertilizer prices will remain structurally elevated as Middle East supply disruptions shift negotiation power to manufacturers.
The argument
The closure of the Strait of Hormuz has blocked millions of tons of urea exports from major producers like Saudi Arabia and Qatar. Although summer represents a seasonally slow demand period, the structural supply deficit is expected to persist and pressure buyers through 2027.
The thesis, stress-tested
✓ What validates it
- ✓Urea prices remain above historical averages through the Q3/Q4 buying season
- ✓Strait of Hormuz shipping volumes remain restricted past mid-2026
▸ Risks discussed
- ▸A sudden reopening of shipping lanes could rapidly normalize supply
- ▸Seasonal demand lulls in the summer could temporarily depress spot prices
Hear it yourself
"close. It's starting to look like farmers are probably said, listen, if I usually put down two fifty pounds of nitrogen, I might scale it back to two forty, two thirty five. There shouldn't be that big of an impact. And people might think, well, Josh, that's a small percentage. Why would I even care? You think about that small percentage over the global nitrogen market, that turns out a very big number of tons. They're no longer being digested. And so you take that demand destruction, you take some of these markets kinda spreading out the demand, you know, maybe not buying quite as early as they normally would."
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