BMO Equity Research IN Tune The Iran Conflict Is Upending Fertiliser Markets - Why We Care in Metals (28 min)
Mar 27, 2026
Joel Jackson, Managing Director covering chemicals, fertilizers and ag equipment, explains how the Iran conflict is rattling fertilizer supply chains. They discuss soaring nitrogen and sulphur prices. Conversation covers limited spare capacity, China’s role, seasonal inventory risks, mining vulnerabilities to sulfur shortages, and how higher ammonia feeds into explosives and costs.
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Middle East Dominates Nitrogen And Sulfur Supply
- The Middle East supplies ~40–50% of global nitrogen and sulfur exports, driving a sharp price surge in nitrogen (30–60%) and rising sulfur spot prices in China.
- Joel Jackson links Qatar gas disruptions, Egypt gas cuts and regional export dependency as the core supply shock mechanics.
Prices Likely Take About A Year To Normalize
- Even if the conflict ends quickly, normalization likely takes about a year, similar to the 2022 Russia‑Ukraine episode.
- Lasting damage uncertainty (especially to gas fields) and depleted channel inventory extend the unwind timeframe.
Very Limited Slack Exists To Replace Lost Nitrogen
- There's little idle global nitrogen capacity to plug shortfalls; China currently restricts exports and other producers face gas allocation cuts.
- Examples include Algeria reducing gas to ammonia plants and a Yara outage in Australia cutting supply.