China ordered an early sale of nitrogen, phosphate and compound fertilizer from commercial reserves ahead of spring planting after the effective closure of the Strait of Hormuz disrupted a major supply route. The move was intended to support orderly trading and stabilize prices; it does not, by itself, show that China had run short of fertilizer.
The disruption has already driven sharp increases in some fertilizer prices and interrupted exports. The risk of lower harvests and tighter food supplies later in 2026 and in 2027 is a forecast, not an outcome already measured.
Why did China release fertilizer reserves early?
On March 13, 2026, Reuters reported that the China Agricultural Means of Production Association had instructed storage firms to sell fertilizer held in national commercial reserves. The sale covered nitrogen, phosphate and compound fertilizers and was scheduled at least 15 days earlier than in previous cycles, ahead of spring planting.
The timing followed the effective closure of the Strait of Hormuz at the end of February. Releasing stocks into the domestic market can add supply during a critical planting period and help temper local price pressure. The announcement was a market-stabilization measure, not evidence that China had exhausted its fertilizer stocks.
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How does the Hormuz disruption affect fertilizer supply?
The strait matters because Gulf producers are important suppliers to international fertilizer markets, especially for urea, a widely traded nitrogen fertilizer. The Agricultural Market Information System (AMIS), in its May 12, 2026 assessment, said the closure marked an inflection point in fertilizer markets. It estimated that the Near East usually accounts for one-third of global urea exports and that 2.6 million tonnes of Near East fertilizer exports had been suspended over two months.
With export routes unavailable, most regional production facilities continued operating at reduced rates to limit stock accumulation. The disruption therefore affected both the movement of existing product and the ability of producers to keep supplying export markets at normal rates.
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What has happened to fertilizer prices and trade?
AMIS reported on May 12 that urea prices had roughly doubled since the disruption began. Phosphate prices had also risen, but more moderately from levels that were already elevated. These are dated market developments, not a guarantee that prices will keep rising or remain at the same level.
Trade measures have added another layer to the disruption. In its July 10 analysis, the WTO Secretariat said China first tightened controls on several fertilizer products and inputs, including urea and sulphuric acid, and later allowed limited urea exports under a quota system. That sequence is neither a complete export ban nor a full return to unrestricted exports. The WTO also warned that export restrictions can push up global prices.
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| WTO estimate | What it measures | How to read it |
|---|---|---|
| Up to 15% of world fertilizer exports | Exports potentially affected by measures introduced after the Hormuz closure | An estimate of exposure, not the share of exports confirmed lost. |
| 23.3% of world fertilizer exports | Potential exposure if all fertilizer exports from Gulf economies are treated as restricted | The WTO’s upper limit for potentially affected exports, not actual trade losses. Some shipments continued by alternative routes, including Saudi exports via Yanbu, with higher costs and logistical constraints. |
The WTO Secretariat’s analysis was current to October 2, 2026. The two percentages describe different assumptions; neither is a count of fertilizer that definitively failed to reach buyers.
Does China have enough fertilizer for its own farms?
China’s domestic position is distinct from the global export shock. An April 27, 2026 report by China Daily, hosted on the Henan provincial government website, described domestic fertilizer supply as stable while warning that global energy and fertilizer price increases could raise agricultural costs.
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China’s production outlook also does not erase the trade disruption. Reuters reported on March 13 that the China Nitrogen Fertilizer Industry Association expected China to produce a record 76.5 million tonnes of urea in 2026. That was a forecast, not a final production result. At the same time, Chinese export controls affected how much product could reach international buyers.
China Daily quoted Li Guoxiang, a researcher at the Chinese Academy of Social Sciences’ Rural Development Institute, as saying that about one-fifth of the world’s fertilizers are produced in the Gulf region and roughly 46 percent of global urea supply originates there. Those figures are Li’s attributed estimates; they should not be treated as independently established measurements here.
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Could fertilizer disruption affect harvests and food prices?
Fertilizer availability and cost matter to farm economics: farmers facing more expensive or less accessible inputs may change how much they apply, and that can affect yields. The eventual effects depend in part on how long the trade disruption lasts. AMIS said duration would be decisive for supply, prices, farm profitability and, ultimately, yields.
On July 5, 2026, FAO Director-General QU Dongyu warned that fertilizer scarcity caused by Hormuz disruptions would lead to lower yields and tighter food supplies in the latter half of 2026 and into 2027. That is a warning about future risk, not a report that those harvest or food-supply effects have already occurred. QU said: “This is not only a geopolitical crisis, but also a disruption at the core of the global agrifood system.”
For household budgets, higher fertilizer costs are a potential upstream pressure on food prices, not evidence that grocery prices will rise by the same proportion as urea. The supplied market assessments do not quantify how much, or when, fertilizer costs will pass through to consumer food prices.
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