Farmers face high fertilizer prices — with no end in sight

In fall, many farmers have to pull out their Magic 8 Balls and predict: do they buy their 2027 fertilizer now, or take a gamble and wait until spring?

It’s a tough decision. Fertilizer costs as much as 20% more than this time last year. But it could get even more expensive in the spring.

Really, no matter when farmers buy fertilizer, it’s kind of a lose-lose, according to Aaron Lehman, president of the Iowa Farmers Union.

“I don't think that there's any winners in this,” Lehman said.

That’s because prices are high and are likely to stay high. Fertilizer spiked after the Iran war started.

“And there's really no end in sight,” Lehman said. “There are no low fertilizer prices in sight at all.”

Lehman is buying now. He said others are hedging their bets and waiting until spring — it’s really a mixed bag.

“As an economist who is paid to have a crystal ball, I have no idea what to tell you,” said Trey Malone, an agricultural economics professor at Purdue University.

Malone said that U.S. agriculture — and its input costs — are part of a massive global market which he likes to think of as a ball of yarn.

“Those strings move in a lot of wild ways,” he said, “and we've never seen the yarn ball be pulled this uniquely.”

From erratic trade deals to tariffs and wars — including Russia's invasion of Ukraine, which also spiked fertilizer prices in 2022.

“So, this is not unprecedented,” said Jacqui Fatka, lead economist for farm supply and biofuels at CoBank.

Fatka said the key difference is that back then, farmers were getting more for their crops.

“They could pay right out of their earnings to be able to buy those inputs,” she said.

Now, crop prices are lower. That means farmers are using less cash and more loans for purchases, whether they’re buying fertilizer now or in the spring.