Data show that fertiliser shipments passing through the Strait of Hormuz have begun to increase following a temporary agreement to end the war with Iran, though analysts say it will take some time before they return to pre-conflict levels and provide some relief to the market.
Before the United States and Israel launched the war on Iran on 28 February, roughly one third of all globally traded urea — the world's most widely used fertiliser — and nearly half of all seaborne sulphur, a key ingredient in fertiliser production, normally passed through the strait. The near-complete closure of this vital waterway for most of the conflict caused a sharp drop in those shipments.
The latest flow analysis by specialist agency Argus Media indicates that since the announcement of the Washington–Tehran agreement on 15 June, approximately 640,000 tonnes of sulphur — a key component in fertilisers such as diammonium phosphate — have left the strait bound for destinations including Indonesia, Morocco, Tanzania and China. That compares with a total of just 80,000 tonnes over the entire three-and-a-half-month war.
At the same time, the latest data from consultancy CRU show that around 427,000 tonnes of urea have transited the strait in the wake of the temporary agreement, up from 275,000 tonnes during the war.
Shipments of other key fertilisers, such as phosphate and ammonia, have also edged slightly higher since the agreement was reached.
Food crisis fears recede
Fertiliser prices rose sharply during the war, prompting farmers to cut back on their use. This raised fears that a prolonged closure of the strait could reduce agricultural output and trigger a global food price crisis.
More than 500 vessels are currently stranded in the Gulf. Despite a pick-up in traffic this week, it still represents only a small fraction of the average of 125 ships per day that transited the strait before the war.
Sarah Marlow, head of fertiliser pricing at Argus, said: