The U.S.-Israeli war against Iran has led to a steep increase in the price of fertilizer, further affecting the bottom line for already-strapped Indiana farmers as the growing season begins.
The eight most popular fertilizers U.S. farmers rely on during spring growing season have shot up in price as ships carrying the chemicals are waylaid in the Strait of Hormuz, just south of Iran between the Persian Gulf and Gulf of Oman.
Indiana Farm Bureau president Randy Kron said March 19 that before the war fertilizer prices had already hit the high end of the scale and farmers here were just hoping to break even. Now, farmers are looking at an extra 30-40% in fertilizer costs, he said.
With Indiana’s growing season just getting started, too much uncertainty remains to tell how this might affect food prices, experts said.
Indiana farmers feel the squeeze
The problem is personal for Kron, who owns a corn and soybean farm in Evansville. He’s already pivoting to handle the increased cost, but it won’t be easy, he said.
“On our farm, we are going to try to slim down fertilizer inputs, but we can’t cut back too much because it will hurt our yield,” Kron said. “It’s a fine line there, everybody is going to be looking at how to pinch pennies.”
Last year, Kron and other Indiana farmers operated on tight margins and this year could be even grimmer, he fears.
Three farmers in his neighborhood have already decided to quit, Kron said. They looked ahead and saw that if they spent the next three years working in the fields, they’d have less money than they do now.
“It’s pushing the older generation to say, ‘Why am I going to work my tail off and lose money,?’” Kron said.
With fewer younger farmers taking over and costs continuing to rise, Kron said he fears for the future of Indiana’s farms.
Indiana is the seventh largest agricultural state in the U.S. with farmers here exporting about $6 billion in crops to Canada, Mexico, Turkey and other countries, according to 2023 data from the Indiana Department of Agriculture.
War poses a risk to that revenue, said Todd Davis, chief economist with the INFB.
“There is fear right away, and that’s just part of the nature of the future’s market,” Davis said.
Davis estimated that rising fertilizer costs would increase the price of growing an acre of corn by $25 to $33. An acre of soybeans would be about an extra $11 to $12.
If you scale those costs up to a midsized Indiana farm of about 1,000 acres, Davis said, farmers are looking at an extra outlay of $17,000 to $23,000 year over year.
Federal attempts to help farmers
In an effort to bring some relief to farmers, American Farm Bureau Federation President Zippy Duval sent a March 9 letter to President Donald Trump, asking him to take steps to limit disruptions.
In return, Trump temporarily waived a federal statute March 18 requiring that transport ships sailing between U.S. ports be U.S.-built, U.S.-owned, U.S. flagged and U.S.-crewed. This will allow foreign ships to transport goods within U.S. ports.
“Any ship available that could ship fertilizer or fuels is critical,” INFB’s Kron said. “We are appreciative of that help now, but it’s not going to turn this around overnight, but maybe stops the bleeding a little bit from making it worse.”
Waiving the statute was just one of many AFBF’s requests. The government has not yet acted on the others, such as working collaboratively with other countries to maintain shipping lanes.
“Acting quickly to prevent disruptions in fertilizer supply chains will help avoid additional financial strain on farmers and ensure that U.S. farmers have the supplies they need to feed families across America,” Duval wrote.
Potential price fixing scheme muddies waters
The war’s impact comes as fertilizer companies face a U.S. Department of Justice investigation into price-fixing in the fertilizer industry prompted by two class action suits.
Both suits, the first filed by Fire Creek Farms in Illinois on March 7 and the second by Union Line Farms in Colorado, accuse a number of top U.S. fertilizer producers of price fixing since at least January 1, 2021.
Prior to the lawsuits, the Iowa Corn Growers Association asked the DOJ to investigate price fixing.
The Trump administration has a history of helping farmers, Kron said, adding he hopes that pattern will continue. If fertilizer costs stay high, opening more markets for corn and soy could help cover some of the expense, he said, but would not solve the problem entirely.
“If you’re a farmer, you’re pretty optimistic most of the time,” Kron said, “but this is going to be a rough patch for farmers.”
Karl Schneider is an IndyStar environment reporter. You can reach him at karl.schneider@indystar.com. Follow him on Twitter @karlstartswithk or BlueSky @karlstartswithk.bsky.social
IndyStar’s environmental reporting project is made possible through the generous support of the nonprofit Nina Mason Pulliam Charitable Trust.
This article originally appeared on Indianapolis Star: Farmers face steep increase in fertilizer prices thanks to Iran war
Reporting by Karl Schneider, Indianapolis Star / Indianapolis Star
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