Fertilizer Prices Skyrocket Amid Iran Conflict, Alternative Firms See Opportunity

Fertilizer prices have been on a rollercoaster this year due to trade disruptions and high natural gas prices, which are used in fertilizer production.

Nearly all industries rely on fossil fuels, but agriculture is especially intertwined with these fluctuations because natural gas is both an energy source and a chemical input in ammonia production, a key fertilizer ingredient.

The war in Iran has caused global seaborne trade in fertilizers to be severely affected, with about one-third of trade passing through the Strait of Hormuz, which has been closed to commercial traffic.

Fertilizer prices have surged, with urea reaching $850 per metric ton in April, an 80% increase from before the conflict and the highest level since 2022.

Companies like Pivot Bio are working on alternative fertilizers that use genetically edited microbes to provide nitrogen to plants, which can replace up to 50% of synthetic fertilizer.