War deepens delays in Brazil fertilizer sales - Valor International

The pace of fertilizer purchases by Brazilian farmers is slower this year than in 2025, according to industry companies and analysts. The delay has been exacerbated by the conflict in the Middle East, a region with key suppliers of raw materials used in fertilizer production, but had already been underway, reflecting falling agricultural commodity prices and rising producer debt.

According to Mosaic, one of the world’s leading producers of concentrated phosphate and potash nutrients for agriculture, sales have reached 30% so far this week across crops, compared with 38% at the same time last year. The lag comes amid weaker commodity prices and tighter farm margins, which are worsening exchange ratios.

“This leads farmers, at first, to consider cutting back on technology,” said Eduardo Monteiro, head of Mosaic in Brazil, during Expodireto Cotrijal in the second week of March in Não-Me-Toque, Rio Grande do Sul. “But in difficult years, they need to focus on farm management, optimizing costs while also keeping an eye on productivity and profitability.”

He said the soybean exchange ratio currently stands at 26 bags per tonne of fertilizer, up from 24 bags a year earlier. For corn, which is also under price pressure, the ratio has climbed to 61 bags, compared with 43 in 2025.

“Purchase decisions partly explain the delay, as farmers expect either input prices to fall or agricultural commodity prices to rise,” Monteiro said. He added that postponements could lead to a more concentrated buying window and potential “logistical stress.”

The slowdown in purchases could intensify further. The Middle East conflict has pushed fertilizer prices higher in recent weeks, further deteriorating exchange ratios. “If the conflict is resolved, the situation may stabilize. If not, it will likely remain as complex as it is now or worsen,” he said.

One raw material that has surged is sulfur, a key input for phosphate production and sourced from the Middle East. At the start of 2025, it cost $120 per tonne. This year, even before the war began, it had already reached $550 per tonne.

The assessment is similar at the Brazilian unit of the Norwegian fertilizer producer Yara. Guilherme Schmitz, vice president of marketing and agronomy, said that purchases for the 2026 wheat crop are around 40%, below the typical 50% to 60% range for this time of year. Buying for the next soybean crop stands at 35%, about 10 percentage points below the historical average.

“Last year, the market was already moving more slowly, with farmers delaying decisions. This year, the pattern is repeating itself, and the lag is even greater,” Schmitz said.

He noted that fertilizer prices used to track grain markets, rising and falling in tandem with commodities, but that link has weakened. “Now they have decoupled, because the raw materials used in fertilizer production are no longer driven by fertilizer demand itself. Sulfur, for example, is influenced by mineral refining segments,” he said.

This decoupling makes it harder for farmers to time purchases, contributing to delays.

Schmitz added that sulfur prices were already rising before the conflict and have accelerated further since. He also noted that China’s restrictions on phosphate exports since 2026 have tightened supply.

The company sees risks of supply shortages. “We have worked to mitigate this risk as much as possible. Today, 25% of our demand is supplied from Europe, 25% is produced in Brazil, and the remaining 50% comes from third-party suppliers through a robust and secure network,” he said.

Fertilizer prices have risen broadly since the start of the conflict. According to consultancy StoneX, urea prices have jumped 50% to $725 per tonne CFR (cost and freight). Monoammonium phosphate (MAP), currently priced at $845 per tonne CFR, has risen 14%, while potassium chloride (KCl) is up 3% to $385 per tonne CFR.

Renato Françoso, a fertilizer risk management consultant at StoneX, said deteriorating exchange ratios could lead farmers to cut back on fertilizer use. “With higher prices, farmers run the numbers more carefully. A poor exchange ratio also raises their cost per hectare,” he said, noting that during the Ukraine war in 2022, fertilizer deliveries in Brazil fell from nearly 46 million tonnes to 41 million tonnes. In 2025, volumes reached 49 million tonnes.

For Maurício Buffon, president of Aprosoja Brasil, demand for fertilizers is likely to decline this year. “Farmers who can carry out a thorough reassessment of their soil will need to rely on phosphorus reserves, as they have been maintaining good soil fertility. So beyond the delays, I expect a contraction in the market,” he said.

A week after U.S. and Israeli strikes on Iran, Aprosoja Brasil issued a statement advising farmers to exercise caution and avoid unnecessary early purchases of fertilizers.

Buffon said prices could eventually readjust, adding that now is not the time to “give in to logistical pressure.”

José Carlos Hausknecht, a partner at MB Agro, said the slower pace of fertilizer purchases is likely to persist throughout the year due to worsening exchange ratios. “Fortunately, the soybean crop will only be planted in the second half, so there is still time for the market to normalize, provided the war does not drag on,” he said.

The reporter traveled at the invitation of Bayer.