The Strait of Hormuz Crisis: How a Maritime Chokepoint Disrupted Global Energy and Fertilizer Markets

What happened to alternative suppliers

The crisis exposed stark differences in how exporting nations could adapt. US LNG became a critical substitute: QatarEnergy purchased 33 US LNG cargoes to offset its lost Hormuz exports . However, Qatar's economy was forecast to shrink 8.6% in 2026 because it lacks overland alternative export routes . Saudi Arabia and Iraq could redirect some oil and refined products via overland pipelines to Red Sea ports, but these routes have limited capacity relative to the volumes that normally transit Hormuz .

For nitrogen fertilizers, the loss of Gulf ammonia and urea supply—which accounted for roughly a quarter of global trade—could not be quickly replaced because spare production capacity elsewhere was limited . Non-oil commodities such as methanol, aluminum, sulfur, and graphite were also severely disrupted, impacting global manufacturing and the green energy transition .

Downstream consequences: Mosaic and North American farmers

The fertilizer disruption hit US agriculture with particular force. Mosaic, the largest US phosphate fertilizer producer, idled nearly 2 million tons of US phosphate production, citing skyrocketing costs for sulfur—about 20% of the world's sulfur supply normally moves through the Strait of Hormuz . The company also announced plans to reduce phosphate operations at select facilities in both North America and Brazil due to curtailed raw material availability .

For a single ton of fertilizer, Mosaic's selling price was about $800, and half of that cost—before processing, shipping, and labor—now went just to sulfur . The company lost $258 million in its quarter ending March 30 . A Mosaic executive warned the crisis could leave global fertilizer supplies 20% to 30% short of demand .

US farmers saw urea prices surge nearly 30% within weeks of the disruption ; fertilizer suppliers faced a projected shortfall of 25–35% in typical spring inventory . The World Bank reported that nitrogen (urea) prices climbed above $850 per metric ton in April, up 80 percent since February and the highest level since April 2022 . The US government temporarily suspended anti-dumping duties on Moroccan phosphate fertilizer in early July to partially offset domestic shortages .

Warnings about spring planting and food security

With the Strait effectively closed since late February, the entire spring 2026 planting season in the Northern Hemisphere occurred without normal fertilizer supply chains . The US Farm Bureau warned that if farmers could not secure remaining fertilizer supplies in time, there could be "reductions or shifts in planted acreage, ultimately affecting crop yields and food production" . UN officials described the situation as a "dire fertiliser shortage" that risked long-term agricultural output losses and heightened global food insecurity, especially in import-dependent developing countries .

A UN-led initiative was underway to safeguard fertilizer shipments through the Strait, with a source involved in the effort noting that some farmers in Latin America were already forgoing their second corn plantings, while growers in Africa faced significant yield reductions . The FAO warned that the fertilizer scarcity would affect subsequent harvests and food supplies . About a third of the world's fertilizer supply normally passes through the Strait of Hormuz; the effective closure during the critical spring window heightened risks of elevated food prices and lower crop yields in the 2026–2027 season .