Fertiliser Prices Surging Despite Strong Exports

Since our March update, fertiliser trade has seen a lot of action. Prices have hit multi-year highs, China stopped exports to India, and in July Chinese fertiliser shipments reached decade-high levels. Farmers have grown anxious as all three NPK nutrient prices spiked year-on-year (US NOLA barge prices for urea up ~30% yoy, DAP up ~50% yoy, MoP up 26% yoy), though urea prices have eased from their May peaks.

Urea led the early rally, with NOLA FOB prices peaking at $455/st in May before easing back to $400/st in Sept, still up 29% year-on-year. Production shutdowns in Iran and Egypt, both hit by gas supply disruptions, combined with Chinese export curbs, pushed prices higher in the first half of the year. News of China resuming exports in May softened prices, though renewed outages in the Middle East because of the Iran-Israel conflict pushed prices back up. Despite weaker exports out of the AG this year, Russia and Algeria filled the gap, supporting global seaborne urea volumes in 1H25. As AG volumes return and stabilise, 2H25 exports should outperform 1H25.

Phosphate has suffered from chronically high prices since 2021 when Chinese DAP/MAP export restrictions were put in place. An especially delayed restart to Chinese DAP/MAP exports this year pushed prices even higher but June finally brought Chinese DAP/MAP shipments back into the market, with July volumes hitting a three-year high of 1.3 Mt. However, cumulative Jan-Jul exports are still down 1.0 Mt year-on-year at 2.2 Mt. Chinese demand from more intensive farming practices and lithium iron phosphate batteries used in electric vehicles continues to pressure the Chinese export market every year. Although Chinese DAP exports have halved, phosphate exports from elsewhere rose 4.5 Mt year-on-year to 25.0 Mt in 1H25, largely due to growing Indian demand.

The potash market has been well supplied, with Russian and Belarus exports growing despite sanctions. However, robust demand and higher production costs have lifted FOB prices roughly 26% year-on-year, and delays to Canada’s big Jansen mine should keep prices firm into 2026. Though Canadian exports have been steady at 5-6 Mt per quarter this year, overseas volumes have recently doubled, from 0.6 Mt 2Q24 to 1.1 Mt in 2Q25. Recently. Russia has imposed export quotas (June–Nov 2025) to stabilize its local market during mine maintenance and rising domestic demand, hurting seaborne volumes.

The China-India trade is the market’s main wildcard as China effectively stopped DAP/MAP shipments to India with no shipments since November last year. It has also extended what is normally a short pre-planting slowdown (two months last year) into a five-month halt before exports resumed in June. And yet, there are still no India-bound volumes, with flows rerouted to destinations like Ethiopia and Nepal instead. India has found other sources however, growing their trade relations with Morocco, Egypt, Jordan and other exporters.

Like DAP/MAP, Urea is also facing a similar unofficial restriction on exports to India. Chinese urea exports resumed in June 2025 following a complete halt since the beginning of 2024. Though the government keeps increasing the export quota, with no shipments to India, significant volumes have failed to materialise, having negligible impact on international prices. There’ll be another quota allocation of 0.7 Mt of urea, but there’s limited time to get the volumes out as exports will be restricted again from November until the end of the domestic demand season in 2Q26.

Despite the export disruptions, Chinese bulk fertiliser exports in 1H25 rose to the highest level since 2021, up 2.6 Mt y-o-y to 12.5 Mt. With DAP/MAP exports back in July, and strong performance from other nutrients, July volumes (4.9 Mt) were almost equivalent to the total exported during 1Q25 (5.0 Mt).

By Hamid Agassi, Dry Bulk Analyst, Research, SSY.

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