When Farm Journal asked economists, farmers and ag retailers what could threaten profitability in 2026 in the latest Ag Economists’ Monthly Monitor, fertilizer prices rose to the top. Despite farmers cutting back on fertilizer and increased political scrutiny, analysts say the odds of meaningful relief remain slim.
“There’s never a moment where I like to say prices can’t come down,” says Josh Linville, vice president of fertilizer at StoneX Group. “Because the second you do that, the market will humble you. But when I look at everything that’s happening globally, and I look at how little time we really have between now and the start of spring, I see a lot more roads that lead to flat or higher prices than I do to lower ones.”
Cutting Back Fertilizer Has Limits
Farmers are clearly responding to high prices, particularly on nutrients where application can be adjusted. Linville says phosphate took the brunt of those cuts last fall.
“If you go back to the fall season, we believe phosphate application in North America was down about 20% from normal,” Linville said at the 2026 Top Producer Summit. “That’s exactly what we expected to see. We had high fertilizer prices, low grain prices and phosphate sitting there saying, ‘I’m the highest-cost input, and I’m variable-rate.’ If you’re a farmer looking to cut costs, that’s where you go first.”
What happens next remains uncertain, and if you ask Linville, that uncertainty itself is a risk to the market.
“The question we don’t know yet is what that means for spring,” Linville says. “Is spring demand down another 20%? Or does some of that fall reduction just get pushed into the spring window?”
Even with reductions, acreage levels keep overall demand elevated.
“At the end of the day, we’re still talking about planting roughly 93 million acres of corn in 2026,” Linville says. “There are people making a very good argument for 95 million acres. I’m not ready to move our team there yet, but even at 93, that’s still a massive amount of demand.”
And for certain nutrients, farmers simply don’t have a choice.
“If you’re going to plant corn, if you’re going to plant wheat, you have to have nitrogen,” Linville points out. “There’s no getting around that.”
“Waning Optimism” on Price Relief
From Rabobank’s perspective, the outlook is growing more discouraging. Samuel Taylor, farm inputs analyst for Rabobank, says hopes for relief on fertilizer affordability are fading.
“To be honest, I think we’re going to be talking about high input prices and poor affordability through most of this year, and even into the third and fourth quarters,” he says. “Some nutrients might see short-term improvement, but phosphate remains the biggest concern.
“There is some optimism around ammonia,” he adds. “We do have new North American capacity coming online, and over a longer time period that should help. But when it comes to phosphate affordability, we actually run the risk that average phosphate prices this year could be higher than last year.”
A Hard Message for 2026
Neither analyst downplays how difficult the current environment is for farmers.
“Farmers should be frustrated. They should be angry, upset, every negative emotion under the sun. When you look at urea relative to corn prices for this time of year, we’ve never seen that ratio this high going back to at least 2018,” Linville says. “Phosphate ratios are as high as ever starting a year.”
And prices are moving the wrong direction.
“Since the first half of December, urea is up about $100 a ton,” Linville says. “UAN looks like it’s about ready to jump. Anhydrous looks like it’s about ready to go. Phosphate is likely to rally as soon as spring demand shows up.”
Taylor is blunt in his assessment, as he thinks it’s unlikely we’ll see fertilizer prices come down.
“I’m fairly bearish on the outlook for input prices coming down,” he says. “In many ways, we’re just kicking the can down the road.”
Phosphate Prices Are Being Set Globally
Both analysts point to phosphate as the clearest example of why fertilizer prices might stay elevated and why the problem is structural.
“When we talk about phosphate, we’re not talking about a lack of competition,” Linville says. “We’re talking about a lack of global supply.”
Production and exports are concentrated in just five countries: China, Russia, Morocco, Saudi Arabia and the United States. China alone dominates global trade.
“Normally, China exports 8 to 10 million tons of phosphate,” Linville says. “In 2025, they exported just over 5 million tons. As we sit here right now, with the information we have, China is not exporting phosphate until August.”
The impact of that absence ripples through the entire market.
“If the world’s biggest exporter is not participating for several months of the year, global prices are going to be higher,” Linville says. “There’s nothing the U.S. can do about that. We move up with the global market.”
Taylor sees the same dynamic playing out, and he doesn’t believe it will resolve quickly.
“China is looking like an unreliable supplier to the global market again,” Taylor says. “When you combine that with geopolitical risks in other key producing regions, this is starting to look much more structural than temporary.”
High Costs Are Forcing Production Offline
Even if demand softens, analysts say prices have a built-in floor because production costs have surged.
“One of the biggest things people miss is intermediate pricing,” Taylor says. “Sulfur prices ran up in the third and fourth quarters, and that’s pulling marginal phosphate production off the market.”
That squeeze is already visible, according to both Taylor and Linville.
“The stripping margins for phosphate producers have collapsed through the floor,” Taylor says. “In certain geographies, the stripping margin, which is essentially your gross margin, is actually negative.”
“We’ve already seen an [Single Superphosphate] facility in Brazil shut down because the cost of production was higher than the value of the finished product,” he says. “If we try to push prices lower from here, you’re not going to get cheaper fertilizer. You’re just going to get less of it.”
In the U.S., phosphate rock availability adds another constraint.
“We only have so much phosphate rock left. Producers aren’t going to mine it at a loss. As soon as you get back to breakeven or worse, production shuts off, and that lost supply fixes the price again,” Linville adds.
Consolidation Isn’t the Whole Story
With fertilizer prices high, consolidation in the industry has drawn increasing scrutiny from policymakers. Taylor acknowledges the frustration but cautions against simplistic conclusions.
“I’m not sure I’m the right person to say whether there are anti-competitive practices,” Taylor says. “But what I do think gets missed in this conversation is the sheer cost of bringing new production online.”
He points to multibillion-dollar investments, long permitting timelines and environmental obligations.
“Look at the Canadian potash expansion projects. We’re talking about $8 billion in capital. Look at retirement obligations at phosphate facilities. Look at the cost of building a nitrogen or ammonia plant today. You need a very strong balance sheet just to survive that process,” Taylor says.
That reality creates economies of scale that are difficult to avoid.
“We do need some semblance of consolidation,” he adds. “That’s not necessarily the answer farmers want to hear, but if you aim for total self-reliance, particularly in potash, you might actually end up paying more, not less.”
Nitrogen Shutdowns Aren’t Manipulation
Accusations of intentional supply restriction are especially common in nitrogen markets. Linville, who previously worked for a nitrogen manufacturer, pushes back on that idea.
Plant outages, he says, are often misunderstood and planned shutdowns are often a safer option.
“You either shut it down with the people, the parts and the plan in place, or you wait for something to break, and then it’s down even longer,” Linville exp From the outside, it can look like manipulation. From the inside, it’s just reality.”
Policy Is Blurring Market Signals
Taylor says domestic policy is also preventing markets from correcting.
“Government support is blurring the demand falloff we might otherwise see, and that demand destruction is often what helps correct prices,” Taylor says.
But then when you throw in trade policies, Taylor says that adds another layer of cost.
“We’ve seen reciprocal tariffs, countervailing duties and those costs are passed straight through to farmers,” Taylor says. “There are mechanisms within our control that could help, but there’s very little we can do about Chinese domestic policy or geopolitical conflicts in the Middle East, which sit right at the heart of global fertilizer production.”
What Farmers Need to Know for 2026
Despite the frustration, both analysts stress discipline.
“My advice is always the same: Farm to return on investment, not to yield,” Taylor says.
“Be emotional right now, that’s human,” Linville adds. “But when it comes time to make decisions for your fields or your marketing, leave that emotion at the door. That’s where people get hurt.”
For now, fertilizer remains one of the biggest threats to farm profitability in 2026 and one that might not offer easy relief.