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Escalation of the conflict in the Middle East pressures the global agricultural input market, increases concern over production costs, and forces Brazil to accelerate strategies to ensure supply
The worsening war involving Iran, the United States, and Israel is already beginning to have direct effects on the global agribusiness. One of the main impacts is related to the fertilizer market, whose global supply has started facing new uncertainties after the closure of the Strait of Hormuz, a strategic route for international trade. The information was released by Folha de S.Paulo on June 2, 2026, highlighting that the issue has become a priority on the Brazilian government’s international agenda due to the risks for the next harvest.
According to the report, Chancellor Mauro Vieira brought the issue of fertilizer imports to the center of negotiations held in Beijing earlier this week. Furthermore, the concern was also present in recent trips to Uzbekistan and Kazakhstan, countries considered strategic for diversifying agricultural input suppliers.
The movement occurs because Brazil remains highly dependent on the import of fertilizers, a factor that increases the agricultural sector’s vulnerability to international geopolitical crises.
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Conflict in the Middle East pressures fertilizer prices
The closure of the Strait of Hormuz immediately raised concerns in international markets.
The region plays a fundamental role in the global logistics of energy and raw materials, directly influencing various economic segments.
As a consequence, fertilizer prices registered strong pressure after the start of the military escalation involving Iran, the United States, and Israel.
Data from the World Bank shows that the global price of fertilizers increased by 12% in just the first quarter of 2026.
Additionally, in April, the values reached the highest level recorded since 2022.
The scenario is even more concerning because the international financial institution’s forecast points to an accumulated increase of 30% throughout 2026.
Thus, Brazilian farmers are closely monitoring the developments of the conflict, mainly because fertilizers represent a significant portion of agricultural production costs.
Consequently, any significant increase in prices can directly affect the profitability of crops.
Government intensifies negotiations with China, Uzbekistan, and Kazakhstan
In this scenario, the Brazilian government has been adopting measures to reduce supply risks.
Mauro Vieira’s trip to China had the main objective of reinforcing the dialogue on the supply of fertilizers to Brazil.
The topic was present in meetings with Han Zheng, Chinese vice-leader, and also with Wang Yi, China’s Foreign Minister.
Additionally, the agenda was part of the 5th edition of the Brazil-China Global Strategic Dialogue, a diplomatic mechanism created in 2014 to strengthen relations between the two countries.
In parallel, the chancellor also visited Uzbekistan and Kazakhstan during the month of May.
The objective of these trips was to expand the network of international suppliers and reduce dependence on a few markets.
According to experts, the strategy seeks to increase the security of national supply in the face of possible trade restrictions or new geopolitical crises.
Furthermore, diversification reduces risks associated with unilateral decisions by major exporters.
Brazil heavily depends on fertilizer imports
The government’s concern is supported by sector numbers.
Data compiled by the Confederation of Agriculture and Livestock of Brazil (CNA) show that 93% of the fertilizers used in Brazilian agriculture in 2025 came from abroad.
In other words, only a small portion of national consumption is supplied by internal production.
This dependence means that any international instability directly affects the costs of Brazilian agribusiness.
Moreover, the increase in fertilizer prices tends to impact not only rural producers but the entire food chain.
When costs rise, the tendency is for part of this pressure to be passed along the production process.
Consequently, consumers may also feel indirect effects through food inflation.
Urea is among the products most affected by the crisis
Among the fertilizers most impacted by the current situation is urea.
This product is a nitrogen fertilizer widely used in the cultivation of corn, sugarcane, and pastures.
Additionally, its production depends directly on natural gas.
As gas prices also faced pressure due to the conflict in the Middle East, urea ended up registering a significant increase in costs.
The impact is particularly concerning for grain producers and livestock farmers.
This is because the use of this input is essential to ensure productivity and efficiency in various agricultural activities.
Consequently, persistent increases may compromise the planning of the next Brazilian harvest.
China is the main supplier, but also represents a strategic risk
China currently holds a prominent position in supplying fertilizers to Brazil.
In 2025, the country accounted for 26% of all the volume imported by the Brazilian market.
Right behind is Russia, responsible for 25% of the fertilizers acquired by Brazil.
Although the Chinese participation is important to ensure supply, it also represents a strategic challenge.
This occurs because Beijing has a history of adopting control measures over exports when it identifies risks to internal supply.
In times of economic or geopolitical instability, the Chinese government tends to prioritize national food security.
For this reason, Brazil closely monitors any signals related to possible restrictions.
History of restrictions increases market concern
The recent history reinforces these concerns.
In 2021, faced with rising internal prices, the Chinese government instructed fertilizer manufacturers to prioritize the domestic market.
At the time, several companies announced the suspension of exports.
Additionally, the country began requiring inspection certificates for the shipment of fertilizers and related inputs.
The measure created difficulties for exporters and was interpreted by analysts as an indirect way to limit sales abroad.
Now, according to reports from industry sources heard by Reuters and Bloomberg agencies, China has reportedly intensified customs inspections and restricted some exports following the escalation of the war in Iran.
Although there are no official confirmations of widespread blockades, the market remains attentive to developments.
Brazilian Agribusiness Seeks Alternatives to Reduce Vulnerability
In this scenario, experts advocate that Brazil quickly advances in diversification strategies.
According to a document released by CNA, the costs caused by international conflicts are already reaching rural producers.
Therefore, the entity considers it essential to anticipate risks and expand supply options.
Moreover, strengthening productive and technological alternatives appears as one of the priorities to reduce external dependency.
The recommendation includes investments in research, development of new agricultural technologies, and expansion of national input production.
Meanwhile, the government continues to intensify diplomatic negotiations to ensure supply before the start of the next summer harvest.
International Scenario Will Continue to Influence the Market
The evolution of the war in Iran will continue to be closely monitored by producers, investors, and Brazilian authorities.
This is because the fertilizer market remains directly linked to global geopolitical conditions.
If the conflict prolongs or causes new logistical interruptions, prices may continue to rise in the coming months.
On the other hand, a stabilization of the international situation could relieve some of the current pressures.
Until then, Brazil is working to strengthen its supply security and reduce exposure to external risks, at a decisive moment for national agribusiness and the planning of the 2026/27 harvest.
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