West Asia Tensions Spark Fertiliser Crisis, Driving Up Corn and Soybean Prices

The global fertiliser market is experiencing a severe supply crunch due to geopolitical tensions in West Asia and resulting supply chain disruptions in the Strait of Hormuz. This has driven up prices for key fertilisers, including diammonium phosphate, which surged by 28.4% in the first nine months of the year to $802.5 per tonne.

The rise in fertiliser costs has had a ripple effect on agricultural commodity prices, with corn prices increasing by 13.3% and soybean prices rising by 22.6%. Farmers are being forced to use less fertiliser due to higher costs, which is weighing on global yield expectations.

Kutay Guzgor, investment research director at participation bank Kuveyt Turk, warned that logistical bottlenecks and persistent rigidity in phosphate fertiliser prices could cement a structural decline in agricultural yield expectations.