High Fertilizer Costs Likely To Cause Food Price Spikes

An American Farm Bureau Federation survey released in April reported that 70% of respondents said they couldn't afford all the fertilizer they needed this season.

Some farmers are more vulnerable to price swings than others. Producers of corn and wheat, which rely heavily on fertilizer, can spend around a third of their operating costs on fertilizer alone. Half of the farmers who responded to a survey released by the National Corn Growers Association in early April said they wouldn't apply the full amount of fertilizer to their corn crop this year, due largely to higher costs and limited availability.

Because farmers often secure their fertilizer stores well before a growing season begins, some weren't seriously affected by the price swings created by the war in Iran. (Iran said it closed the Strait of Hormuz shortly after it was attacked by the U.S. and Israel at the end of February. U.S. corn growing season typically begins in April.) But they are worried about the future: corn growers who responded to the survey were twice as concerned about the 2027 corn crop as they were about this year's.

This season, some farmers may opt to plant crops that require less nitrogen fertilizer than corn, such as soy beans, in response to rising costs.

According to USDA data, farmers are expected to plant 95.3 million acres of corn this year, down from 98.8 million acres last year. But the total acreage of soybeans is predicted to rise to 85.4 million acres this year from 81.2 million acres last year.

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