Potential U.S. sanctions on Russia threaten Brazil’s fertilizer supply - Valor International
Potential U.S. sanctions on countries maintaining trade ties with Russia over the war in Ukraine are already putting pressure on fertilizer prices and could directly impact Brazil.
Brazil imported 41.34 million tonnes of fertilizers in 2024, with about 25% sourced from Russia, data by the National Association for Fertilizer Diffusion (ANDA) show. Analysts warn that if Brazil is included in the scope of potential measures, it could face higher costs and supply challenges.
For the 2025/26 soybean crop, whose planting is about to begin, the immediate effects should be contained since most fertilizers have already been purchased. However, risks increase from 2026 onward if the war drags on and sanctions intensify, said Bruno Fonseca, an input analyst at Rabobank.
Analysts note that major buyers like Brazil, China, and India are unlikely to halt purchases from Russia given the scale of demand and limited alternatives. Still, growing supply concerns have led India to bring forward fertilizer imports, according to a report by Itaú BBA.
The Brazilian bank highlights that replacing Russian fertilizers would raise costs, as Russian inputs remain highly competitive. In 2024 alone, 53% of Brazil’s MAP (monoammonium phosphate), 40% of KCl (potassium chloride), and 20% of urea came from Russia.
Mr. Fonseca, the Rabobank analyst, recalled that the market demonstrated resilience in 2022, when Brazil increased purchases from Canada to offset sanctions on Russia and Belarus. However, he warned that a forced shift in suppliers could lead to short-term price spikes. Interestingly, current tensions between the U.S. and Canada might even facilitate Canadian exports to Brazil.
Fertilizer prices, already sensitive to geopolitical disruptions, have been further affected by recent events. A U.S. strike on Iran in June heightened tensions in the Middle East, driving up urea prices due to the region’s strategic importance. “Even with expectations of a pullback, prices stayed elevated as India and Brazil entered the market,” Mr. Fonseca noted.
Global costs are also under pressure in the NPK complex (nitrogen, phosphorus, and potassium). According to Tomás Pernías, an analyst at StoneX, the imbalance between global supply and demand is exacerbated by China’s export restrictions to prioritize domestic needs, while India’s strong demand continues to sustain prices.
In July, urea prices climbed 5.2% at Brazilian ports, Itaú BBA reported, reflecting increased demand ahead of planting for the 2025/26 second-crop corn. Potassium prices are also rising, with Rabobank estimating an average 10% increase in fertilizer costs compared to last season.
The price surge and limited supply have reshaped purchasing patterns. Brazilian fertilizer imports rose nearly 20% from January to July compared to the same period in 2024, StoneX data show.
This increase is partly driven by the replacement of fertilizers like MAP and DAP (diammonium phosphate) with less concentrated alternatives such as SSP (single superphosphate), which require higher volumes. As a result, Brazil imported 2.1 million tonnes of MAP—7.6% less than in 2024—while SSP imports jumped nearly 19%.
Nitrogen-based fertilizer imports also rose about 12% compared to the same period last year.
