Fertilizer Outlook Shows Global Risk, Higher Costs

By: Faith Parum, Economist, American Farm Bureau Federation - 09/13/2025

Fertilizer costs are having a bigger and bigger impact on farm budgets. In the lead-up to the 2022 crop year, fertilizer prices surged to record highs, driven by tight global supplies, energy shocks and trade disruptions. That period became a turning point in how farmers and policymakers thought about farm input risks. Fertilizer prices eased somewhat in 2023 and 2024 as energy markets stabilized and supply chains recovered, but price volatility is at the forefront once again.

While prices today remain below the extreme peaks of 2022, prices for several key fertilizers are climbing higher. Phosphate fertilizers are leading the increase, while nitrogen products are showing month-to-month swings, and potash is rising due to trade policy risks. At the same time, the share of fertilizer within total farm production costs has not returned to earlier highs because other expenses are also climbing. Livestock expenses, electricity, cash labor, interest, rent and property taxes are among the categories showing notable increases in 2025, adding to the overall pressure on farm budgets.

Farmers are facing a familiar challenge: building budgets and making planting decisions with unpredictable fertilizer markets. This Market Intel updates current price levels, revisits the drivers of fertilizer markets and explores what they mean for 2026 farm planning.

Phosphates have had the sharpest price increase this year. Gulf diammonium phosphate (DAP) prices rose from about $583 per ton in January 2025 to nearly $800 in August. That is a 36% increase in less than eight months, creating new strain for already struggling crop budgets. Monoammonium phosphate (MAP) has followed a similar trend, reflecting the same pressures in production costs and export availability.

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