US Fertilizer Through 2026: Potash, Ammonia, and the Affordability Reset

The 2024 consumption stack and the post-peak reset #

USDA Economic Research Service data through the 2024 marketing year places US plant nutrient use at roughly 21.0 million tonnes of nitrogen, 4.2 million of phosphate measured as P2O5, and 4.5 million of potash measured as K2O. Corn alone accounts for 45 percent of nitrogen demand and roughly 38 percent of potash demand, a structural concentration that ties US fertilizer pricing to the Chicago Board of Trade December corn contract more tightly than to global nutrient balances. Application rates were broadly steady in 2024, with corn N rate near 145 pounds per acre and a small downward shift in phosphate use on the back of soil-test inventories built during the high-price 2022 and 2023 cycles.

The price reset has been the dominant story. Muriate of potash (MOP) FOB Saskatchewan averaged 300 dollars per tonne in Q4 2024 against the Q1 2022 peak of 850 dollars, a 65 percent drawdown. DAP at Tampa cleared near 580 dollars against 1000, and granular urea at New Orleans (NOLA) priced at 300 to 320 dollars against 700. Anhydrous ammonia delivered to Iowa retailers fell to roughly 600 dollars per tonne from 1500. The full retracement still leaves prices roughly 30 to 50 percent above the 2017 to 2019 average, a residual premium that reflects the loss of Belarusian potash from world trade, OCP Jorf Lasfar phosphate concentration, and the Henry Hub to TTF spread that capped European nitrogen restarts in 2024.

Potash: Saskatchewan dominance and the Belarus and Russia carve-out #

Canadian production, dominated by Nutrien (Rocanville, Allan, Cory, Lanigan, Patience Lake, Vanscoy) and Mosaic (Esterhazy K1, K2, K3, Colonsay, and Belle Plaine solution mining), shipped 23 million tonnes of MOP in 2024, roughly 33 percent of the 70 million tonne global trade. The US imports 95 percent of its potash and Canada delivers more than 85 percent of those imports through the Northgate, Coutts, and Kingsgate rail crossings. Saskatchewan provincial royalties on potash, set under the Crown Royalty and Production Tax regime, generated 1.1 billion Canadian dollars for the province in 2024, second only to oil and gas in non-tax provincial revenue.

The Belarus and Russia carve-out is the structural shift. Before sanctions Belaruskali (BPC) and Uralkali shipped roughly 28 million tonnes per year combined, near 40 percent of global trade. The 2022 EU sanctions package and the closure of the Klaipeda port route under the Lithuanian rail termination removed Belarusian volume from the Atlantic basin. Belaruskali rerouted through Russian Baltic ports and overland to China, and Uralkali continued shipments to India and China at structural discounts. Brazil and Southeast Asia absorbed displaced Russian and Belarusian volumes, allowing Nutrien and Mosaic to retain North American pricing power. The K+S Bethune mine in Saskatchewan and ICL Dead Sea operation provide marginal supply but do not contest the Nutrien Mosaic price discipline that runs through the Canpotex export channel.

Ammonia and urea: the Henry Hub structural advantage #

US ammonia capacity stands at roughly 18 million tonnes per year across CF Industries (Donaldsonville, Verdigris, Port Neal, Yazoo City, Woodward), Koch Fertilizer (Enid, Beatrice, Dodge City), Nutrien (Borger, Augusta, Geismar), Yara (Belle Plaine), and OCI (Wever, Iowa). The US imported 14 percent of its ammonia in 2024, mostly from Trinidad and Canada through the Tampa and Donaldsonville terminals. Domestic urea capacity is closer to balance, with CF Donaldsonville and Koch Enid covering roughly 80 percent of demand and the residual sourced from Middle Eastern (SABIC, QAFCO, Sorfert) and Egyptian production through NOLA.

Henry Hub gas at 3.10 dollars per million Btu in Q1 2026 against European TTF at 12.80 dollars gives the US ammonia complex a variable cost advantage of roughly 250 dollars per tonne. CF Industries reported 2024 Donaldsonville cash gas cost of 1.20 dollars per MMBtu under hedged book, against Yara Sluiskil 2024 gas cost of 11.40 dollars. CF Industries 2024 reported revenue of 5.2 billion dollars and EBITDA of 1.7 billion, an EBITDA margin of 33 percent and ROIC near 14 percent against a 2022 ROIC of 38 percent that the company has guided will not return absent another European supply shock. The build-out of low-carbon ammonia capacity under the Inflation Reduction Act 45Q credit has anchored 4 million tonnes of incremental capacity at Donaldsonville and Wever for 2027 and 2028 commissioning, conditional on the IRS Section 45V hydrogen rule final treatment of fossil-derived ammonia with carbon capture.

Phosphate, OCP, and the Section 232 file #

OCP Group of Morocco controls more than 70 percent of global phosphate rock reserves, concentrated in the Khouribga, Youssoufia, and Boucraa basins, and produces roughly 12 million tonnes of P2O5 per year through the Jorf Lasfar and Safi complexes. Mosaic (Bartow, New Wales, Mulberry, Riverview) and Nutrien (White Springs, Aurora) cover most of US phosphate demand from Florida and North Carolina rock, but the Florida resource base is in long-run depletion and Mosaic has signaled a shift toward Saudi Arabian Ma'aden joint-venture supply for incremental tonnes after 2027.

The Section 232 file is the binding policy variable. The 2021 ITC investigation imposed countervailing duties on OCP at 19.97 percent and on PhosAgro at 9.19 percent, which the Court of International Trade vacated in 2023 and the ITC reinstated under remand in 2024. The April 2025 Trump reciprocal tariff schedule placed Morocco at the 10 percent floor, kept Russia outside the reciprocal escalation track since the existing sanctions regime governs, and excluded Belarus from the schedule. Mexican phosphate (Fertinal under Grupo Mexico) carries IEEPA tariff exposure under the migration and fentanyl national emergency declarations, with treatment subject to the USMCA carve-out for goods that meet rules of origin. The net effect through 2026 is a 50 to 80 dollar per tonne floor under Tampa DAP relative to international parity, which Mosaic has captured directly in 2024 reported gross margin of 21 percent against a 14 percent five year average.

Farm affordability: Iowa, Illinois, Indiana, and the net income line #

USDA ERS reported US net farm income of 140 billion dollars in 2024 against the 2023 nominal peak of 185 billion, a 24 percent year-on-year decline. The 2025 forecast was revised in February 2026 to 158 billion on stronger livestock and dairy receipts and a partial corn price recovery to 4.50 dollars per bushel. Crop receipts fell more sharply than the headline: corn cash receipts dropped from 80 billion in 2023 to 61 billion in 2024, soybean receipts from 60 billion to 47 billion. Government payments under the 2024 Emergency Commodity Assistance Program added roughly 10 billion to crop sector cash flow, partially offsetting the price compression.

Iowa State University and Ohio State University extension budgets place fertilizer at 35 to 40 percent of corn variable cost in Iowa, Illinois, and Indiana for the 2025 crop, against 38 to 45 percent in 2022 and 28 to 32 percent in 2019. A 1000 acre Iowa corn-soy operation on a 90 percent corn rotation now budgets 240 to 280 dollars per acre for fertilizer against a 2019 baseline of 140 dollars. The Federal Reserve Beige Book agricultural section reported Q4 2024 farm loan delinquency rates of 2.0 to 2.5 percent across the Chicago, Kansas City, Minneapolis, and St. Louis Districts, the highest reading since 2020. Chapter 12 farm bankruptcy filings rose 12 percent year-on-year through Q1 2026 on AOUSC data, concentrated in Wisconsin dairy and Iowa hog and corn operations carrying 2022 and 2023 vintage equipment loans at 8 percent rates.

The 2026 outlook and the residual risk concentration #

The base case through 2026 holds the post-peak band: MOP at 320 to 360 dollars per tonne, DAP at 600 to 650, urea at 320 to 360, anhydrous at 620 to 680. The base case rests on three contingencies. First, that Belaruskali and Uralkali do not regain Atlantic basin access through a sanctions easing or a Lithuanian rail reversal, since a return of even half the pre-2022 Belarusian volume would rebuild a 60 to 80 dollar per tonne discount in the Brazilian and Southeast Asian basis that would arbitrage back to NOLA within two quarters. Second, that OCP does not flood the US East Coast with diverted Indian or Brazilian volume to test Mosaic price discipline, a scenario that the Section 232 floor partially blocks but does not eliminate, since DAP can be reformulated as MAP or shipped through tolling channels that complicate the duty calculation. Third, that Henry Hub gas prices do not rise above 5 dollars per million Btu on LNG export demand and Combined Cycle Gas Turbine power load growth, which would compress CF Industries and Koch margin and raise the floor under domestic urea and ammonia by roughly 60 dollars per tonne for every dollar move in Henry Hub.

Risk concentrates in three names and one regulatory file. Nutrien and Mosaic carry the cleanest pricing exposure: a return of Belarusian volume reduces 2026 EBITDA by roughly 15 to 20 percent on consensus modeling. CF Industries carries the cleanest gas-spread exposure: a TTF normalization toward 6 dollars per million Btu would compress the variable cost wedge by half. The Section 45V final rule on low-carbon ammonia treatment will determine whether 4 million tonnes of new US capacity reaches financial close. For the farmer the binding line is the corn-fertilizer price ratio: 2.5 bushels of corn per pound of nitrogen historically marks the comfort band, against a Q1 2026 reading of 1.9. If the December corn contract holds the 4.50 to 5.00 dollar band and the urea NOLA contract holds 350, the 2026 planting cycle clears with thin but positive margins. If either leg breaks, the Beige Book delinquency line moves toward 3 percent and the USDA Farm Service Agency restructuring caseload moves to 2018 to 2019 highs.

Sources #

• USDA Economic Research Service, Fertilizer Use and Markets
• USDA World Agricultural Outlook Board, WASDE
• USGS Mineral Commodity Summaries 2025, Potash chapter
• USGS Mineral Commodity Summaries 2025, Phosphate Rock chapter
• USGS Mineral Commodity Summaries 2025, Nitrogen chapter
• Mosaic Company Form 10-K 2024
• Nutrien Ltd. Form 10-K 2024
• CF Industries Holdings Form 10-K 2024
• International Fertilizer Association, Public Summary 2025
• USDA AMS Illinois Production Cost Report
• USDA ERS Farm Income and Wealth Statistics
• Federal Reserve Beige Book, Agricultural Conditions
• Iowa State University Extension, Estimated Costs of Crop Production 2025
• Ohio State University Extension, Ohio Corn, Soybean and Wheat Enterprise Budgets 2025
• International Trade Commission, Phosphate Fertilizers from Morocco and Russia
• OCP Group Annual Integrated Report 2024
• K+S Aktiengesellschaft Annual Report 2024
• ICL Group Annual Report 2024
• EIA Henry Hub Natural Gas Spot Price
• Argus Media Fertilizer Markets Coverage