Mar 24, 2022 - Economy & Business

Fertilizer prices soar, posing risk of further food price increases

White bags of fertilizer sit on a truck at a factory
Workers load potassium fertilizer imported from Belarus at a port in China's Shandong province on March 9. Tang Ke/Future Publishing via Getty Images

Fertilizer prices have soared in recent weeks as Russia’s invasion of Ukraine further exacerbated global supply chain disruptions.

Why it matters: Fertilizer is a key component in food production, meaning farmers are poised to face higher costs likely leading to further increases in food prices.

  • Fertilizer is about three to four times more expensive than it was in 2020, the Wall Street Journal reported Thursday.

Threat level: Fertilizer accounts for 11% of the variable cash costs for U.S. farmers, according to a Wells Fargo Investment Institute report provided to Axios.

  • Russia and its ally Belarus collectively deliver 9% to 32% of the world's main fertilizer groups (nitrogen, phosphorus and potassium).
  • Russia suspended fertilizer exports earlier this month.

The bottom line: The crisis appears likely to exacerbate inflation.

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