The Iran war: Farmers in Brazil and Argentina face rising fertilizer and energy prices
Fertilizer and energy prices have spiked due to the closure of the Strait of Hormuz, putting pressure on agricultural producers and sparking fears of a potential rise in food prices
- fertilizer
- conflicts
- prices
By Joseph Glauber, Valeria Piñeiro, and Juan Pablo GianatiempoMay 4, 2026
Key takeaways
•Rising global fertilizer and energy prices are straining farmers in Argentina and Brazil even as global food supplies remain relatively ample.
•Heavy dependence on imported fertilizers makes both countries especially vulnerable to disruptions linked to the Strait of Hormuz.
•Lower margins and uncertain weather could push producers toward reduced fertilizer use or less input‑intensive crops, with risks for future supply.
Fertilizer and energy prices have spiked due to the closure of the Strait of Hormuz, putting pressure on agricultural producers and sparking fears of a potential rise in food prices. However, the current situation appears different than earlier food price crises. While the rise in fertilizer and energy prices is shifting incentives in production and energy markets (Figure 1), a recent analysis by Arita and Glauber shows that global supplies remain relatively robust and upward pressure on food prices appears weak.
However, higher prices for key agricultural inputs are likely to have serious impacts for farmers around the world that will reverberate through the food system. These impacts are already appearing at the country level in advance of this year’s planting, as producers face higher fertilizer and energy costs and relatively low global market prices for food.
This blog post examines the impact of the Iran war and Strait of Hormuz closure on two major food-exporting countries, Argentina and Brazil. They account for 10% of wheat, 39% of maize, and 66% of soybean exports in the world, according to U.S. Department of Agriculture (USDA) estimates for the 2025/2026 marketing year. (They also export a range of other agricultural products, including meats, tropical items, and cotton). Both countries also depend heavily on fertilizer imports, a significant portion of which come from the Persian Gulf region. A continued disruption in fertilizer markets could affect producer planting decisions and fertilizer application rates, which could, in turn, affect production and commodity prices.