"Global fertilizer shipments have fallen 11% y/y since the start of the Iran war. The closure of the Strait of Hormuz has restricted fertilizer exports from the Persian Gulf, tightening the global
"Global fertilizer shipments have fallen 11% y/y since the start of the Iran war. The closure of the Strait of Hormuz has restricted fertilizer exports from the Persian Gulf, tightening the global supply and increasing prices. The ceasefire agreement between the US and Iran could lead to a rebound in shipments,” says Filipe Gouveia, Shipping Analysis Manager at BIMCO.
Under normal conditions, 16% of global fertilizer shipments come from the Persian Gulf and pass through the Strait of Hormuz. The closure of the strait has significantly disrupted cargo volumes. Phosphates, urea and sulphur have been particularly affected, with shipments falling 28%, 12% and 30% y/y since the start of the war. This has supported higher fertiliser prices although the price of urea has partly eased recently as China issued new export quotas.
The production of phosphates and urea has been further disrupted by the tighter supply and higher cost of sulphur and natural gas. Sulphur is used to produce phosphates and exporters such as Morocco and China rely on imported sulphur. Natural gas is used to produce urea, and global LNG shipments have dropped 7% y/y since the start of the war.
“The supramax and handysize segments have been impacted
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