World Bank warns fertilizer prices could rise 30%+ in 2026 as Hormuz blockade persists

The World Bank has warned that global fertilizer prices could rise by more than 30% in 2026 if the Strait of Hormuz blockade persists, adding institutional weight to fears of an accelerating agricultural input cost crisis with serious food security consequences.

The warning was issued against a backdrop of already historic price movements: urea spiked more than 53% in March alone, reaching approximately $725.60 per tonne, as the outbreak of conflict along the Hormuz waterway in late February disrupted the flow of nitrogen, phosphate, and potash exports from the Gulf region. The World Bank’s scenario analysis suggests further price acceleration remains plausible if the blockade extends through the primary planting seasons of the Southern Hemisphere and South and Southeast Asia.

The Strait of Hormuz is the conduit for approximately one-third of global seaborne fertilizer trade, including a large proportion of the world’s urea, ammonium nitrate, DAP, and MAP flows. Saudi Arabia’s Ma’aden phosphate export facility at Ras Al-Khair, Iran’s urea export capacity at Bandar Imam Khomeini, and a number of other Gulf-region producers are either unable or structurally constrained from exporting at normal volumes, tightening global balances significantly.

The World Food Program estimates that approximately 260 million people were already facing acute food insecurity in 2026 before the supply shock began. Analysts note that even a temporary fertilizer shortfall this season could compound food security risks well into 2027, as reduced application in 2026 translates into lower crop output that takes a full harvest cycle to remedy.

Production restarts, even in the event of a ceasefire, are not expected to be instantaneous: fertilizer plants idled or operating below capacity due to Hormuz-related logistics constraints will take weeks to months to ramp back to full output, and the backlog of stranded vessels in the Gulf would need to be cleared before export flows normalize.

The World Bank’s analysis follows similar warnings from Yara International’s CEO, who estimated this week that the global fertilizer shortage is costing the world approximately 10 billion meals per week.

Source: The Tyee