Farmers could feel fertilizer price pinch next year if supply dwindles due to Iran-U.S. conflict

As farmers struggle with the rising cost of fuel and fertilizer, CTV News Edmonton's Jeremy Thompson takes a look at the future impacts for consumers.

Halfway between Calmar and Thorsby is a long way from the Strait of Hormuz, but the Iran-U.S. conflict that’s affecting fuel prices is also influencing the cost of fertilizer.

About one-third of the world’s supply of it travels through that waterway.

“There are products that have gone up more than 50 per cent, other products that regular 10-to-15 per cent,” farmer Joe Bendoritis told CTV News Edmonton on Thursday. " So there are drastic changes. It does hit the bottom line and comes right out of the profit margin."

Bendoritis and other farmers buy fertilizer in bulk. Any change in price can make tens of thousands of dollars difference to their input costs.

Most grain farmers around here use two types of fertilizer: anhydrous ammonia, or nitrogen gas fertilizer, which is locally produced and widely available, and granular fertilizer pellets, which are seeing the biggest price spike.

Bendoritis ordered his pellets in December, before the strait closed.

Farm Credit Canada estimates more than 70 per cent of farmers did the same.

“The longer it goes on, it seems like we’ll have more fertilizer supply issues going forward,” Leigh Anderson, a senior economist with the federal agricultural term lender. “If it lasts a couple more months, that starts to impact the fertilizer prices for 2027.”

That means consumers may not see higher prices until fall 2027.

Still, Anderson says farmers are feeling the pinch.

“For the average farmer, that means right now that they’re looking at probably very tight, or if not below break-even, profit for this growing season on most crops,” he told CTV News Edmonton.

Bendoritis says he actually likes what he sees in the future market for the prices of barley, wheat and canola.

“I have my product on hand, we’re going to get our crop in, and I think most farmers are still going to have a great season,” he said.

He says the shorter-term cost pressure in agriculture is fuel.