Thousands of miles away from the Persian Gulf, on his family farm deep in the American heartland, Jason Lewis is making every effort he can to conserve the nitrogen fertilizer he relies on to produce a viable spring corn crop. 

After three years defined by record-high production costs and weak crop prices, resource conservation was already standard practice on Lewis Family Farms in south central Nebraska. But ever since President Donald Trump launched a war with Iran, shuttering the world’s most vital fertilizer and oil export route, it’s become a lifeline.

The Strait of Hormuz is a narrow but critical maritime choke point through which indispensable volumes of fertilizer from producing countries in the Gulf must travel to reach the Arabian Sea, the gateway to the global market. But Iran’s attacks on vessels in the strait have all but closed the waterway, sending fertilizer prices soaring during spring planting season, when row crop farmers need it the most. 

“We’re already starting to feel some of the effects of the closure of that strait there,” said Lewis, who has operated his family farm with his father-in-law for more than a decade. “It’s coming in at a really rough time for us. It’s rough just seeing those prices go up.”

Fertilizer, like oil, is a globally integrated market. Supply chain disruptions in one part of the world affect prices in another. Gulf countries west of the strait account for exports of about 43% of global urea, a solid nitrogen fertilizer integral to growing corn. Because corn is the largest crop sector in the United States, row crop farmers use about 12 million metric tons of nitrogen fertilizer every spring planting season.

It’s the most expensive part of growing, and across the millions of acres of farmland that sprawl over the American Midwest — known as the “corn belt” — farmers who helped send Trump back to the White House were already under economic strain. 

“As planting season began in earnest across much of the U.S., the closure of the Strait of Hormuz sent fuel and fertilizer prices skyrocketing — further straining a farm economy that already had its back against the wall due to record inflation, trade uncertainty, rapidly declining crop prices and catastrophic natural disasters,” the American Farm Bureau Federation, along with 54 of the country’s largest agriculture trade associations, wrote in a letter to Trump earlier this month. 

The coalition, which included the National Corn Growers Association, urged the president and Republican leaders in Congress to include economic relief for farmers in their bid to secure additional funding for the war with Iran. 

Without assistance from the administration, the letter argued, economic losses will reduce crop production and threaten “significant consequences for the food supply chain in America and around the world.”

Row crop farmers have already been stuck in the middle of the president’s foreign policy and trade agenda. Trump’s aggressive reciprocal tariffs on China, the largest buyer of American soybeans, led China to source the commodity from Argentina and Brazil instead. A $20 billion currency swap deal with Argentina last fall compounded farmers’ frustration.  

The fertilizer supply chain crisis augments what has already been a merciless year for American farmers. Farm debt and bankruptcies are projected to rise for the third year in a row, while more than half of American farmers reported feeling worse off than a year ago, according to Farm Journal’s monthly economic survey for January.

Fertilizer prices have remained high since the 2022 Russian invasion of Ukraine choked key export routes, but unlike four years ago, there’s no revenue from surging corn, wheat and grain prices to offset the economic pain the strait’s closure is inflicting. 

“Before the Strait of Hormuz crisis, the global situation of fertilizer was already extremely tight,” said Shawn Arita, the associate director of the Agricultural Risk Policy Center at North Dakota State University. “So this happened in a very, very bad time.” 

Even if the strait were to open tomorrow, Arita said, fertilizer prices won’t soon recover from the lasting impacts of Gulf suppliers halting production amid the war. 

When asked about the war’s impact on fertilizer costs, White House spokesperson Anna Kelly said,“These impacts are temporary, and the best is yet to come for our great farmers.” 

Some farmers could feel less pressure if they locked in fertilizer price contracts with their suppliers before the start of the war last month. But many suppliers, like Lewis’, don’t allow farmers to secure prices until the spring. 

“I’m going to go out tomorrow and start with my spring fertilizer of anhydrous for the corn crop,” Lewis said. “I couldn’t book that in last year … the first prices we’ve gotten for anhydrous ammonia was like $800 a ton, and since the price increases have started, that has shot up to $1,000, I’ve seen.”

The $1,000 price tag for 1 ton of the nitrogen fertilizer is an 18% jump from its prewar price, which hovered around $843. The same is true for urea, which has jumped by more than 35% since the start of the war. A host of key compounds used to make fertilizers, like phosphate, ammonia, sulfur and liquified natural gas, are sitting on container ships at the mouth of the strait, unable to move. 

Far from the corn belt, on the west side of Fresno County, California, Sal Parra is also trying to get ahead of a severe fertilizer shortage. 

“We’re definitely concerned,” said Parra, the director of farming operations for Bowles Farming Company. “If there are limitations to availability, what we’re gonna have to do is really look at optimizing the fertility that is available.”

That could mean cutting farm labor costs, using drip irrigation to save money on water and applying humic acid to condition the soil where Parra grows his corn, almonds, alfalfa and tomatoes.

“But at the end of day, to produce a yield, we need to have that input available,” Parra said of phosphate and potassium fertilizers. 

The strait’s closure has also sent oil prices soaring. Farmers won’t be able to plant their spring crops, till their fields or haul their harvest without diesel fuel. Diesel is more than $5 per gallon for only the second time in U.S. history, as the choke on crude oil in the strait and attacks on critical Gulf energy infrastructure threaten to deepen a global fuel crisis. 

“Growers are about to put fertilizer down right now,” said Veronica Nigh, a senior economist at the Fertilizer Institute, a trade association. “And so there’s a lot of well-founded worry about, you know, where’s this product going to come from?” 

Senate Majority Leader John Thune, R-S.D., has signaled support for attaching a farmer bailout package to a Department of Homeland Security funding bill or defense supplemental. The White House recently waived long-standing federal smog restrictions on cheaper blends of gasoline in a bid to assuage skyrocketing prices. 

But even a farmer aid package would be a temporary fix during a war that threatens to drive up fertilizer costs for years to come.

“When agriculture goes down … it’s a drag on the entire community, on the entire country,” Lewis said. “So I think it’s not just a foreign country problem. It’s a, you know, it’s a nationwide problem.”

The post ‘Could not come at a worse time’: U.S. farmers hit hard by economic fallout of Iran war appeared first on MS NOW.

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