WTO Reports Wild Fluctuation in Urea Price Following Harmony Closure, India Imports Two Third of Requirements

[ABS News Service/13.07.2026]

Geneva – The closure of the Strait of Hormuz following the February 2026 conflict in the Persian Gulf has severely disrupted global fertilizer trade, with nitrogen and phosphate fertilizers among the hardest hit, according to a WTO Secretariat report published Friday.

The analysis finds that fertilizer shipments through the Strait of Hormuz “came to a standstill” after the conflict began, effectively halting one of the world’s most important trade routes for agricultural inputs.

Gulf economies account for 24.8 percent of global nitrogenous fertilizer exports and 11.4 percent of phosphatic fertilizer exports, making the disruption particularly significant.

Urea prices more than doubled – from roughly $400 per metric ton to over $850/mt – before easing to $453/mt in June as markets anticipated progress toward reopening the waterway. Diammonium phosphate prices also climbed sharply, although both remained below the record highs reached following Russia’s invasion of Ukraine in 2022.

The WTO identifies several economies as especially dependent on Gulf fertilizer supplies. India obtains nearly two-thirds of its nitrogenous fertilizer imports from Gulf producers, while Thailand sources nearly half from the region. Australia, Brazil, Morocco and the United States are also significant importers.

The Secretariat concludes that 18 economies are particularly vulnerable because they combine heavy dependence on imported nitrogen fertilizers with high reliance on Gulf suppliers. Those countries include Brazil, Nepal and Sri Lanka, along with numerous African economies, including Kenya, Malawi, Mozambique, Rwanda, South Africa, Tanzania, Uganda and Zimbabwe. Seven of the most exposed countries are least-developed countries.

Export Restrictions

The report also warns that government export restrictions have compounded supply disruptions. According to WTO estimates, trade measures now affect up to 15 percent of global fertilizer exports, while the effective closure of Gulf exports could raise the share of potentially affected trade to 23.3 percent. China, Russia and Türkiye have all imposed various export controls or licensing measures on fertilizers or key inputs such as sulphur since the conflict began.

Despite the market disruption, the WTO notes that fertilizer tariffs are generally not a major obstacle to trade. Nearly 60 percent of WTO members’ fertilizer tariff lines are duty-free, applied tariffs average below 2.5 percent, and several members – including the European Union and Türkiye – have temporarily reduced import duties to ease supplies.

The report also highlights policy responses to cushion farmers from higher costs. The European Commission has adopted a Fertilizer Action Plan backed by a €540 million crisis package, while India recently revised its $4.5 billion nutrient-based fertilizer subsidy program and continues to prioritize natural gas supplies for domestic fertilizer production. The United States has also announced plans to expand domestic fertilizer production.

The WTO concludes that reopening the Strait of Hormuz would help stabilize fertilizer markets and enable governments to roll back emergency trade restrictions. It also urges policymakers to consider the disproportionate impact of fertilizer shortages on developing economies in Africa and Asia, where reduced access to agricultural inputs could undermine food security and increase pressure on already vulnerable populations.