Key Takeaways
- Urea dropped 6.71% on the week to $616.25/T, trimming its year-to-date reading to −10.00% and its year-over-year gain to 59.44%, as the Strait of Hormuz deadlock deepened following the U.S. rejection of Iranian peace talks on May 10 — a move that immediately pushed oil prices up by $3/bbl and raised synthetic fertilizer production costs further.
- DAP held flat at $757.50/T (0.00% weekly), consolidating a 4.84% month-to-date gain and a 21.20% year-over-year advance, with the phosphate complex supported by continued Chinese feedstock export restrictions and firm demand across Brazil and India.
- Sulfur surged 1.46% on the week to CNY 6,966.67/T, extending its extraordinary year-over-year advance to 90.29% and its year-to-date gain to 7.18%, as tightening Chinese sulfuric acid availability continues to pressure phosphate producers globally.
- Brent crude held above $100/bbl at $101.29 (+1.23% weekly), sustaining a 66.46% year-over-year gain, while TTF gas firmed 1.34% to EUR 44.14/MWh — keeping operating cost pressure elevated on European and Middle Eastern nitrogen producers.
- Goldman Sachs and World Bank analysts warn that if Hormuz disruptions persist through end of Q2 2026, the global fertilizer price index could rise more than 30% year-on-year — a scenario that is effectively already materialising across nitrogen markets.
The week ending May 11 brought a sharp pullback in urea — down 6.71% to $616.25/T — even as the geopolitical conditions driving the broader fertilizer price shock showed no sign of improvement. The U.S. rejection of an Iranian peace proposal on May 10 sent crude oil up $3/bbl overnight and reinforced market expectations that the Strait of Hormuz will remain effectively closed to commercial fertilizer traffic through at least the end of Q2 2026. Goldman Sachs and World Bank analysts now warn that a sustained closure could push the global fertilizer price index more than 30% higher year-on-year. For broader agricultural market context, see the iGrowNews agricultural commodities weekly update and agriculture stocks performance tracker.
The Strait of Hormuz: Diplomatic Deadlock and Shipping Risk
The Strait of Hormuz remains the single most acute chokepoint for global fertilizer markets this week. On May 10, the U.S. formally rejected an Iranian proposal for peace talks, immediately triggering a $3/bbl rise in crude oil prices — a direct upstream cost driver for synthetic nitrogen fertilizer production. The diplomatic impasse shows no near-term resolution.
Commercial shipping through the Strait remains largely paralysed, though a small number of highly controlled transits occurred during the week. On May 6, a tanker exited the Strait with its transponder disabled to avoid detection and potential attack. On May 10, a Qatari LNG vessel — the first since late February — passed through under a special mediation agreement, providing a narrow signal of possible diplomatic back-channels but no systemic reopening of the route.
