IFDC: China’s urea exports ease nitrogen prices, but fertilizer markets remain tense

Global fertilizer markets remain under pressure despite a pullback in nitrogen prices following China’s approval of additional urea exports, according to the International Fertilizer Development Center’s (IFDC) 24th Fertilizer Crisis Response Bulletin, published Aug. 11. The bulletin, produced with Argus Media and AfricaFertilizer, said the return of Chinese volumes to international markets has eased some of the pressure created by earlier supply disruptions, but the relief could prove temporary.

The bulletin points to continued risks from conflicts involving Iran and Ukraine. The Strait of Hormuz typically carries about one-third of globally traded fertilizer, leaving markets vulnerable while commercial traffic through the waterway remains constrained. Nitrogen prices have retreated sharply from their July highs as Chinese urea reaches international buyers, but IFDC said a renewed disruption to Hormuz shipping, a reversal of Chinese export quotas or additional sanctions-related restrictions could quickly send prices higher again. Recent market data similarly shows that the reopening of Chinese exports has been a key factor behind the decline in urea prices.

Phosphate markets face a separate set of supply constraints. The bulletin highlights Russia’s sulfur export restrictions and China’s suspension of phosphate fertilizer exports through August, both of which could limit the availability of raw materials and finished products. IFDC also identifies Togo’s phosphate mining sector as a potential source of additional supply for West African markets.

Sources: International Fertilizer Development Center