Global fertilizer prices climb 11% in early 2025: World Bank
Nitrogen-based fertilizers, particularly urea, saw the steepest rise, up 20% year-on-year to an average of US$390 per tonne
GLOBAL – The global fertilizer market has witnessed an 11% increase in average prices in the first quarter of 2025 compared to the same period last year, according to the World Bank’s latest Commodity Markets Outlook released in April.
The report signals renewed concerns over input costs and supply disruptions that could pose challenges to global food production, especially in emerging economies dependent on fertilizer imports.
The World Bank attributes the price spike to a confluence of factors. Chief among them is robust demand from major agricultural producers such as Brazil and India. Both countries ramped up imports ahead of their peak planting seasons, which tightened available supply and elevated international spot prices.
Nitrogen-based fertilizers, particularly urea, saw the steepest rise, up 20% year-on-year to an average of US$390 per tonne.
This surge has been fueled by both higher input costs, especially natural gas, and supply disruptions. Egypt, a top urea exporter, experienced a significant drop in production after repeated disruptions to natural gas flows.
According to S&P Global Commodity Insights, multiple Egyptian fertilizer plants either halted or reduced output in early 2025 due to constrained gas availability, a key feedstock for nitrogen fertilizers.
China’s export restrictions reshape global markets
Compounding the tight supply situation are restrictions from China, traditionally the world’s largest fertilizer exporter.
In 2024, China slashed urea exports by over 90%, and similar curbs were imposed on phosphate fertilizers such as diammonium phosphate (DAP). These moves are part of Beijing’s strategy to prioritize domestic supply chains and support key sectors such as battery manufacturing for electric vehicles.
Chinese phosphate exports, once a stabilizing force in global markets, have sharply declined. A report from Agri-Pulse in March 2025 indicates that global buyers are increasingly looking to Morocco and Saudi Arabia to fill the shortfall, yet these countries are already operating near capacity.
Beyond urea, DAP prices rose 5% year-on-year to reach US$600 per tonne in Q1 2025. While less volatile than nitrogen markets, phosphate supply remains constrained due to geopolitical factors. Sanctions on Russia, another major supplier, have disrupted trade routes, while Chinese cutbacks continue to skew regional availability.
Potash prices (mainly Muriate of Potash, or MOP) have climbed 8% year-on-year. Belarus, one of the world’s largest potash producers, continues to face trade restrictions, further reducing global supply.
Outlook for 2025: More volatility ahead
Looking ahead, the World Bank forecasts that overall fertilizer prices will rise by 7% over the course of 2025, before stabilizing in 2026.
However, prices will remain well above their 2015–2019 average due to persistently high input costs, geopolitical uncertainty, and structural shifts in global trade.
“There are clear upside risks. Any further rise in natural gas prices or continuation of export restrictions, particularly by China, could exacerbate the current price dynamics,” said Ayhan Kose, Deputy Chief Economist at the World Bank, during the report’s release.
Urea prices are projected to rise 15% over the year, but may decline by 4% in 2026 as new production capacity comes online in East Asia and the Middle East. DAP prices are expected to peak at US$600 this year before falling by 8% next year, provided global supply chains normalize.
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