Escalating tensions in the Middle East following attacks by the United States and Israel on Iran are beginning to ripple through the global fertilizer market, a key input for agricultural production in Mexico and across the Americas. Analysts warn that the situation could lead to higher prices and tighter supply.
The region plays a major role in fertilizer production because many of these products depend on energy derivatives. Natural gas, for instance, is the main feedstock used to produce ammonia, a core component in most nitrogen-based fertilizers.
Countries such as Iran, Qatar, Saudi Arabia and Egypt are among the world’s leading exporters. Together, they account for nearly half of global urea exports and roughly 30% of ammonia shipments.
According to the U.S. Department of Agriculture’s agricultural office, disruptions linked to the conflict could affect fertilizer availability just as the spring planting season begins.
Mexico-based consulting firm GCMA notes that crops such as corn and wheat are particularly sensitive to fertilizer price swings, as these inputs can represent up to a third of their production costs.
If tensions persist, analysts say rising costs or shortages could affect the supply of staple grains, especially at a time when the United States has limited room to expand its own imports.
Source: Puente Libre
