Yara sees year-long recovery for fertilizer market when wars end - Valor International

The global fertilizer market would take at least one year to recover its production capacity if the wars in the Middle East—of the United States and Israel against Iran—and in Eastern Europe, of Russia against Ukraine, ended today. This is the assessment of Yara’s Brazil chief executive, Marcelo Altieri.

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Altieri participated in Globo Rural Cast, a podcast from the Globo Rural magazine, during Agrishow, Brazil’s largest agricultural technology fair, in Ribeirão Preto, São Paulo. For him, the current situation is worrying not only for Brazil but for the whole world. The executive noted that 34% of the nitrogen and at least half of the sulfur consumed globally pass through the Strait of Hormuz, which is still blocked due to the war.

At the same time, new clashes between Russians and Ukrainians last weekend affected production units and further disrupted the infrastructure for transporting raw materials needed to produce fertilizers.

“Let’s imagine the war ends tomorrow. It will take a long time to recover the available capacity in the market. With the impact already done to the infrastructure, it could take up to a year to recover and return to pre-war capacity,” he said.

Altieri also pointed out that, in the case of some raw materials, the global fertilizer industry competes with demand from other sectors of the economy, such as the energy industry.

Highly dependent on fertilizer imports, Brazil, which is Yara’s main market in the Southern Hemisphere, is vulnerable to international supply shocks. As the wars continue, the outlook for the availability and delivery of fertilizers for the country’s next harvests becomes more difficult.

According to Altieri, the time between shipment in China and arrival at a Brazilian port is, on average, 90 days. And, depending on the distance, it takes another two or three days for the product to reach the farm.

“Loading today, [the farmer] would be receiving [the product] in August. We already know that there will be an impact, because Brazil’s import capacity is about 4.5 million tonnes per month. It won’t be loaded today, there will be no inventories to replicate the market from the previous year,” he said.

He pointed out that, last year, fertilizer deliveries to Brazilian farmers totaled 49.11 million tonnes, a 7.7% increase over 2024, according to data from the National Association for the Diffusion of Fertilizers (ANDA). For 2026, Altieri projects that Brazil will experience a 10% to 12% decrease in fertilizer deliveries. He noted, however, that with rising input prices, farmers will likely become more selective, leading to a rebalancing of the market.

“A lot of time is being lost, and we can’t recover it for this harvest. We are working to meet the needs of our customers in Brazil. It will be difficult, but the market will regulate itself because farmers will not buy the volumes they used to,” he stated.

Altieri also said that carryover stocks for this year are considered low for the expected demand. Furthermore, any country that still has fertilizer to offer prioritizes supplying its own market, “and doesn’t know if it will return at some point.” With a shortage of raw materials, factories cannot operate at full capacity, “and there is an impact on the industry, which, in Brazil, was already inefficient because of energy costs.”

For him, Brazil’s National Fertilizer Plan had an “excellent intention,” but it has not yet had an effect. He said that, in recent years, Brazil has lost the capacity to produce 1.5 million tonnes per year due to the closure of factories.

“Every time there’s a conflict, we remember ‘why doesn’t Brazil produce?’ We have to work on a plan, not just when a war breaks out. It can’t be a plan of the administration. It has to be a plan for the Brazilian state,” he said.

(Raphael Salomão contributed reporting from São Paulo.)