Fertilizer market in flux due to uncertainty

According to Rabobank, global fertilizer prices rose by around 15% between April and the end of September. Phosphate, in particular, saw a sharp increase in price, rising by almost 19%. This pushed the phosphate index to -0,74 in September, its lowest level in fifteen years.

"The nitrogen index is also declining and is expected to weaken further in 2026," says Bruno Fonseca, senior analyst for Farm Inputs at Rabobank. "The overall affordability index is moving further in the negative direction and is approaching its 2022 low."

The affordability index compares fertilizer prices with agricultural crop prices. With prices of various crops under pressure and fertilizer becoming more expensive, margins are under increasing pressure.

Good harvest puts pressure on prices
Global grain and oilseed prices are under pressure. In 2025, corn, wheat, and soybean production volumes will reach record levels. "Record harvests in countries like Brazil and the US are flooding the market," according to Rabobank. "This is keeping prices low and impacting arable farmers' profitability, which in turn is impacting their fertilizer purchases."

According to the bank, affordability will therefore remain a bottleneck in 2026. Lower incomes in arable farming could lead to reduced fertilizer use, potentially impacting crop yields.

Uncertainty surrounding CBAM remains high
On top of that, the new European Carbon Border Adjustment Mechanism (CBAM) will impose a carbon tax on approximately 15 million tons of nitrogen fertilizer imported annually starting in 2026. This will primarily impact ammonia and urea, products with high CO₂ emissions. "The CBAM will cause a price increase for high-emission fertilizers and force importers to look for suppliers with a lower carbon profile," states Rabobank.

Companies can partly mitigate the impact through strategic purchases of CBAM certificates and the use of so-called carbon futures (EUAs).