Russian companies made an estimated £500m windfall from one type of fertiliser alone this spring as the closure of the Strait of Hormuz sent global prices soaring, an Unearthed analysis has found. 

Russia is the world’s leading nitrogen fertiliser exporter. Its companies earned over £5m a day in extra revenues from urea, the most widely used fertiliser, between March and May this year as Iran’s blockade of the Strait of Hormuz choked global supplies. The fertiliser price shock intensified fears over global food security and rising food prices.

The strait normally handles a third of global seaborne fertiliser trade and a fifth of natural gas shipments, needed to make nitrogen fertilisers such as urea. It is the key export route for major producers in the Gulf. 

However Russia’s exports, which largely travel through Baltic ports, have been unaffected. Meanwhile Russia’s abundant natural gas means that its fertiliser manufacturers are insulated from the increased cost of feedstocks that are hitting competitors.

While Russia’s energy sector and many other parts of its economy have been subjected to price caps and sanctions since the Kremlin invaded Ukraine in 2022, fertiliser exports have continued.

Between 80 and 90% of urea produced globally is for agricultural fertiliser, but the chemical also has industrial uses including diesel additives and resin production. Russia exports most of its urea to major agricultural producers such as Brazil and the US. 

A global price rise quickly becomes a question of whether farmers can plant and whether families can afford to eat
Selena Victor, Mercy Corps

Spot prices for urea – the most widely used fertiliser globally – at Baltic ports almost doubled from late February to late April. Prices began to drop in May, but remained well above pre-war levels. This price surge produced an additional estimated £500m for Russian companies, above what the companies would have made at pre-war baseline prices, during the first three months of the conflict, according to an analysis of pricing and trade data. 

“Russia’s weakened yet still functioning economy and military industry are tightly interlinked,” said Dr. Svitlana Romanko, executive director of Ukrainian campaign group Razom We Stand.

“Export earnings from energy-intensive and gas‑based products help sustain a Russian state‑driven industrial base whose strategic focus is expanding weapons production that targets Ukrainian civilians.”

The disruptions to energy markets that are pushing up the cost of fuel, fertiliser and food and putting millions of people at risk of hunger, the UN’s latest report on global food security found last month.

If the conflict continued into the middle of the year, an extra 45 million people could face acute hunger, the World Food Programme warned in March.

“This would ‌take ⁠global hunger levels to an all-time record and it’s a terrible, terrible prospect,” Carl Skau, WFP deputy director, told reporters. “Already, before this war, we were in a perfect storm where hunger has never been as severe ⁠as now, in terms of numbers and how deep that hunger is.” 

The worst effects of a global nitrogen fertiliser shortage are likely to hit the world’s poorest countries, particularly in Africa, most severely, the CEO of one of the world’s biggest fertiliser producers said in May.

“There is a risk of a global auction on fertiliser that means it becomes unaffordable for those most vulnerable,” said Svein Tore Holsether, of Norwegian fertiliser giant Yara. 

We ostensibly have sanctions on Russia and we are at the same time buying fertiliser products from them
Joseph Glauber, IFPRI

The countries most exposed to this supply and pricing shock are fragile, import-dependent nations already facing conflict and severe weather events, including Somalia, Sudan, Ethiopia, Pakistan, Lebanon and Myanmar, said Selena Victor, senior policy director of Mercy Corps, a humanitarian organisation.

“A global price rise quickly becomes a question of whether farmers can plant and whether families can afford to eat,” she added. Even though prices had fallen after May, continued volatility raised the prospect of lower yields and tighter food supplies for the rest of this year and into 2027. 

“A cheaper shipment arriving after the fertiliser application window cannot restore a missed harvest. The temporary fall in prices therefore did not undo decisions farmers had already made to reduce inputs, change crops or plant less. Renewed disruption now threatens subsequent planting cycles and keeps freight, insurance and energy costs volatile,” Victor said. 

Bumper US imports

Russia’s fertiliser sector is mostly exempt from the sanctions and price caps that have been imposed on its oil and gas sector and much of its other economic activity since the invasion of Ukraine. This exemption was to avoid exacerbating global food insecurity and hunger. 

“Russia’s war against Ukraine has exacerbated acute and chronic food insecurity driven by conflict, climate change, and COVID-19,” officials at the US Treasury department wrote in 2022. “US sanctions on Russia in response to its unprovoked and unjustified war against Ukraine do not stand in the way of agricultural and medical trade.”

The US is a significant importer of Russian urea, and this trade hit its highest level since 2010 at the start of the Iran conflict, US government data shows. Almost half of Russia’s March-May urea windfall revenues – an estimated £225m – came from soaring US imports. 

The blockade of the Strait of Hormuz collided with the start of the US spring planting season in March and April, and American farmers responded by importing record quantities of Russian urea: imports in April 2026 were nearly double those of the same month the previous year. 

Joseph Glauber, senior research fellow at the International Food Policy Research Institute (IFPRI) and a former economist at the US Department of Agriculture, said that while the US sanctions exemption for fertiliser had been intended to protect food supplies to vulnerable and developing countries, the US had benefited.

“This was made more acute because of the closure of the Gulf,” he said. He added there was “an irony that at a time when we ostensibly have sanctions on … [and are] condemning Russia’s incursion into Ukraine, and this war that’s been going on for several years now, [we are] at the same time buying fertiliser products from them.”

European governments have aimed to reduce their farmers’ reliance on Russian and Belarussian fertiliser through introducing tariffs. Last year the EU introduced staged tariffs, rising every year until 2028, aiming to reduce dependence on Russian and Belarussian fertiliser. The UK, whose initial 2022 tariffs had levied 35% on Russian fertiliser but excluded nitrogen products such as urea, closed that gap in July 2025. Import duties on Russian urea will climb to 35% from July 2027. 

UK imports of Russian urea have fallen since the invasion of Ukraine, but the UK still imported 33,900 tonnes of Russian urea during March-May 2026, producing an estimated £8.1m in additional revenues for Russian producers. 

However, Russia’s increasing exports of fertilisers to other regions such as Brazil, Africa and the US have made up for falling exports to the EU and UK. Moscow has placed limits on the volume of fertilisers that can be exported, to protect domestic supply. Even with those caps in place, the price surge was enough to deliver a significant revenue windfall. 

Nitrogen dominates synthetic fertiliser use worldwide, accounting for 58% of fertiliser production in 2023. Historically, crops could only access the small amounts of nitrogen that occur naturally in soil. But technological advances in the early 20th century allowed the production of synthetic nitrogen fertiliser from natural gas. 

Arable yields have since grown to such an extent that it is now estimated that around half of the world’s population depends on nitrogen fertiliser. A sudden and prolonged shortage of nitrogen fertiliser would cause arable yields to fall precipitously, pushing up prices of food crops such as wheat, as well as animal feed crops like soy. 

British farmers are highly reliant on imported nitrogen, said Martin Lines, CEO of the Nature Friendly Farming Network, which supports regenerative agricultural techniques that aim to reduce the use of fertilisers and other agricultural chemicals.

“This exposes us to global price shocks and means putting more money into the pockets of fertiliser companies and nations around the world. Our use of nitrogen is also highly inefficient, with research suggesting around 40% is being lost or wasted,” he said.

 “The transition to nature-friendly farming is vital if UK agriculture is to be resilient to the climate crisis and geopolitics.”

 

How we did it

To estimate Russia’s fertiliser windfall, Unearthed took the difference between the average monthly urea price during the war and a pre-war baseline, and multiplied it by Russia’s monthly export volumes. The baseline is the average February 2026 price of $471 a tonne, using Bloomberg Green Markets’ Baltic FOB series. By late April the price had nearly doubled, peaking at $882 a tonne.

Because Russia stopped reporting export volumes to the UN Comtrade database in 2022, we estimated them using “mirror data” – the imports its trading partners report receiving from Russia – obtained from a private vendor, Trade Data Monitor (TDM). That data shows Russia exported at least 2.5 million tonnes of urea over the three months, a total that may be revised upward as more countries report, making the £500m a conservative estimate.

The figures represent revenue, not profit: they do not take into account producers’ costs. But urea’s main feedstock is natural gas, whose global price has risen during the war. Russia is a major gas producer and regulates its domestic gas prices below international levels, insulating its producers from that cost pressure. That means Russia’s margins on these sales are likely to be wider than those of competitors buying gas on the world market.

Urea prices started to slowly drop again in May, but the latest available data shows they are on the rise again, as Iran recently blocked the Strait again following renewed aggression from the US.  

We are grateful to Joseph Glauber, senior research fellow at the International Food Policy Research Institute (IFPRI), for providing the mirror data on Russian fertiliser exports from Trade Data Monitor (TDM).