Fertilizer Maker Yara Warns Farmers Are Being Squeezed by Price Surge Amid War
- Serena Valentino
- 5 days ago
- 2 min read
By Nina Kienle March 27, 2026 6:58 am ET The Wall Street Journal
The price of urea in Egypt—the regional benchmark—jumped 54% over the past month
Farmers are likely to scale back fertilizer purchases amid surging prices, the head of fertilizer maker Yara International said, sounding the alarm about how the Middle East war could affect the food supply chain.
“Farmers are now being put in a real squeeze,” Yara Chief Executive Officer Svein Tore Holsether said in an interview. “Input costs are significantly higher, crop prices are not.”
The price of urea in Egypt, the regional benchmark, jumped 54% over the past month, according to FactSet. The conflict in the Middle East has disrupted shipping through the Strait of Hormuz, cutting off the supply of oil and natural gas, raw materials and fertilizers from the region that pass through it to global markets.
The Middle East is a major supplier of urea and other fertilizers made from natural gas. In 2024, the region was the source of close to 30% of global exports of major fertilizers, according to data from the International Fertilizer Association.
The supply shock has buoyed shares of fertilizer producers like Yara, CF Industries and K+S, as investors bet the companies will benefit from higher prices.
Holsether said Yara is setting prices according to global pricing trends. Yara has limited direct exposure to the region, but has been affected by rising freight and natural-gas costs and had to curtail production at a plant in India because it didn’t have gas, he said.
“We have to expect some demand destruction,” Holsether said. “I think it’s natural that you will see some switching of crops, and the farmers need to go after the crops that give them the best margins given the uncertainty.”
The fertilizer price increase comes at a critical time in the growing season for farmers in North America and Europe, and lower use could weigh on crop yields, Holsether said.
“We will see that in the next harvest and then it’s too late, so now is really the time to support the growers in their decisions,” he said.
Yara is confident the steps it has taken in recent years to diversify its energy exposure and ammonia production, and to move energy-intensive activities out of Europe, will help it deal with the current situation, its CEO said.
“Volatility is the new normal,” Holsether said.
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Appeared in the March 28, 2026, print edition as 'Fertilizer Maker Yara Cautions on Price Spike'.
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