Market and product

EU temporarily waives fertilizer tariffs to support farmers

On May 22, the Council of the European Union (EU) announced a temporary one-year suspension of customs duties on certain nitrogen-based fertilizers, including urea and ammonia, in an effort to reduce the impact of the Iran conflict on the region’s agricultural sector.

Since the Strait of Hormuz was almost completely closed, global fertilizer prices have risen sharply because roughly one-third of the world’s traded fertilizers pass through this route. Although the EU is not directly dependent on nitrogen fertilizer imports from the Middle East — imports from the region account for only around 3% of ammonia and 1–2% of nitrogen fertilizers — countries have simultaneously sought alternative supplies, pushing up prices for all types of fertilizers.

The tariff exemption does not apply to imports from Russia and Belarus. To balance the interests of domestic producers, the EU has capped the duty-free quota at the equivalent of 2024 most-favored-nation (MFN) import volumes plus 20% of imports from Russia and Belarus during the same year. The measures will take effect a few days after publication in the EU Official Journal.

Earlier, the Food and Agriculture Organization warned that if the blockade of the Strait of Hormuz continues, the risk of a global food crisis is real.

American farmers face mounting difficulties

In the United States, farmers are being hit from multiple directions at once: soaring fuel and fertilizer costs due to the Iran conflict, combined with the most widespread drought in years.

According to the Kentucky Department of Agriculture, since the closure of the Strait of Hormuz in late February, agricultural diesel prices have risen by 72%. Urea prices — a key nitrogen fertilizer heavily produced in the Gulf region — have increased by 55%, while another nitrogen-based fertilizer has risen by 33%.

More than 60% of the continental United States is currently experiencing drought conditions, up from 43% at the beginning of 2026 and 33% during the same period last year. The United States Department of Agriculture forecasts that hard red winter wheat production — used for breadmaking — will fall to its lowest level since 1957.

In Texas, many farmers say they did not purchase fertilizer ahead of the planting season and may not use fertilizer at all this season. Farmer Tommy Salisbury of Tulsa County, Oklahoma, said that the Trump administration’s $12 billion support package intended to offset tariff-related losses has effectively been wiped out by soaring input costs. A survey by the American Farm Bureau Federation found that most farmers cannot afford to purchase sufficient fertilizer for this crop season.

Agriculture Secretary Brooke Rollins acknowledged that the agricultural sector is facing a difficult period: “We are seeing significant price increases while the farm economy is already under considerable pressure.”

Source: 
https://www.reuters.com/world/eu-suspends-duties-fertilizers-ease-impact-hormuz-crisis-farmers-2026-05-22/
https://www.reuters.com/business/environment/am-i-out-drought-rising-costs-iran-war-deepen-pain-us-farmers-2026-05-20/