Fertilizer shortages due to Iran war threaten agricultural republican state

The closure of the Strait of Hormuz due to the Iran war has caused fertilizer prices to soar, hitting farmers’ pockets directly and threatening to cause food prices to soar.

Now, as Democrats seek victory in the U.S. midterm elections in November, they see a new opportunity to turn the tide and break out of a price crisis that has cost them years in crop and livestock producing states.

The Strait of Hormuz is an important transportation route for fertilizers, including about 50% of the world’s nitrogen-rich urea fertilizer, according to the Fertilizer Association, an industry group. The strait has been virtually impassable since President Donald Trump launched the attack, which is now in its third week with no end in sight.

The closure could send fertilizer prices soaring just before planting season, disrupting decision-making for farmers across the country. It also adds to the slump in commodity prices that have already been depressed for years, eating away at farmers’ profits.

“We’re in uncharted territory,” Matt Frostik, a Michigan farmer who serves on the board of the National Corn Growers Association, said in an interview with CNBC. It’s like code red.

Frostik said he purchased nitrogen fertilizer. cornwhich was about $350 per ton in January. The product is now approaching $600 per ton, he said.

The uncertain outlook for farms comes eight months before midterm elections that could see President Trump lose control of both houses of Congress. Democrats seeking competitive seats in agricultural-heavy states such as Iowa, Minnesota and Nebraska are pinning on rising fertilizer prices as yet another example of the affordability issues that continue to plague Mr. Trump and the Republican Party.

“There are a lot of people in my district who, just like me, say, ‘I don’t get it, I don’t get it.’ It was already hard, and now they’re making it even harder. No one knows why,” said Jake Johnson, a public school teacher who is running against incumbent Republican Rep. Brad Finstad in Minnesota’s 1st District.

“Our No. 1 job as a campaign, and what we want to tell everyone we talk to, is that we need a way to make things cheaper,” Johnson said.

The Democratic Party’s rural appeal comes after years of hard-fought advocacy in the rural, agricultural states in the middle of the country. In 2024, Trump won almost every state in the Midwest except Minnesota and Illinois. He also dominated county-by-county contests, winning in 2,660 counties compared to former Vice President Kamala Harris’ 451, centered on the nation’s most populous regions, according to the Center for Politics.

Changing the course of rural America has long been a goal of Democrats, but often proves elusive. In 2018, Democrats won three of the four seats in the state legislature in Iowa. Republicans currently control all four companies. But with President Trump’s economic support plummeting and Democrats leading in the popular vote, they have high hopes for this year.

Johnson said farmers in particular are rebelling against President Trump’s tariff campaign, which saw the White House approve about $12 billion in relief last year. The war has now added a new inflationary wrinkle.

“A vote for me is a vote to end tariffs, and a vote to end war.” “We must start by undoing the obvious damage that the current situation has inflicted on us.”

Republicans, meanwhile, are scrambling to push for more aid to farmers just months after last year’s infusion. An additional farmer bailout, estimated at about $15 billion, has been under discussion since before the outbreak of war to combat low crop prices, and lawmakers are now seeking to incorporate it into Iran’s additional spending bill. The White House has announced a $200 billion spending request for the war.

“It’s clear that there will be additional action on the Iran conflict,” Sen. John Hoeven, a Democrat who heads the Senate Appropriations subcommittee responsible for funding the Department of Agriculture, said in an interview.

Hoeven said he expects such a package would need to include more than just war spending to win Senate approval. He cited disaster aid that Democrats want, as well as aid for farmers that would likely be added.

On Thursday, more than 50 agricultural industry groups, including the Farm Bureau, sent a new letter to President Trump urging him to include farm aid in future defense packages.

“As the administration considers what should be included in a defense complementation package,
“We urge you to include much-needed market relief for American farmers in the coming weeks,” the letter said.

Sen. John Boozman (R-Ark.), chairman of the Senate Agriculture Committee, said he is working with the administration to find an immediate solution to the fertilizer problem.

“The good news is that everyone understands how much of a problem this is for farmers,” Boozman said in an interview. “So everything is on the table. We are looking at all the options available to us and we hope to finalize a plan soon, if possible.”

Boozman did not elaborate on what the plan would be. His counterpart in the House, Rep. GT Thompson (R-Ark.), said President Trump is “aggressively” working to open the Strait of Hormuz.

Thompson noted that Trump is working with “other countries to make sure that transport ships and tankers can safely navigate that small area.”

He also said that tariffs on fertilizers should be removed ahead of the planting season.

“There should be no tariffs on fertilizers or their ingredients,” he said.

Treasury Secretary Scott Bessent said Thursday on FOX Business that Agriculture Secretary Brooke Rollins “will likely make an announcement regarding fertilizer in the coming days.”

Bessent noted that President Trump’s tariffs largely exempt nitrogen-based fertilizers, which are essential to growing corn.

But despite efforts to free the trapped cargo ship, opening the strait to allow the flow of fertilizer remains a tall order for the administration. And the risks to U.S. farmers and food consumers continue to rise.

“If we do not strategically prioritize the supply of critical agricultural inputs such as urea, ammonia, nitrogen, phosphates, and sulfur-based products, the United States risks crop shortages,” Zippy Duvall, president of the American Farm Bureau Federation, said in a recent letter to President Trump. “Not only is this a threat to our food security and thus our national security, but such a production shock could contribute to inflationary pressures across the U.S. economy.”

Joe Glauber, former chief economist at the Department of Agriculture under the Obama administration and fellow emeritus at the International Food Policy Research Institute, said the shock was similar to when Russia invaded Ukraine, but noted that the associated spike in commodity prices is no longer seen.

“We will reach record levels in 2022,” Glauber said. “But another factor that was very high in 2022 was grain prices, so farmers were able to more or less get by because even though they were paying very high fertilizer costs, they were getting a good profit on what they sold.”

Glauber said it’s natural for farmers to be worried if they’re only concerned about their balance sheets: what they grow and what they sell. But he noted that the influx of government payments to farmers, such as those currently being considered in Congress, have been large in recent years.

“When you include payments from the government, it’s a different story,” Glauber said. “And there was a big payment from the government.”

Michigan farmer Frostick said he is aiming to pass a “consumer choice” bill in Congress that would allow drivers to buy ethanol gasoline (known as E15) year-round. Ethanol is typically cheaper than regular gasoline, and the bill could boost commodity prices by giving farmers a new market.

And while Mr Frostick said he was grateful for the government’s payments, he said the relief package may not be enough and he would rather sell his crops to make money.

“I would rather sell my product and make money than have the government write me a check and feel good,” he said. “It distorts the market so much that it can become like picking winners and losers, and if you receive a check like that, it’s usually a pass-through.”