Fertiliser prices rise 11% fueling food inflation fears

Prices of urea, a nitrogen-based fertiliser, have surged 11 percent one week ahead of the planting season, as the Iran war disrupts global commodity markets, sparking fears of food inflation in Nigeria.

The war, which has closed the Strait of Hormuz, has shut down fertiliser plants in the Gulf region that account for a third of global urea trade and severely disrupted shipping routes.

With fertiliser prices surging, climate change worsening, and farmers cutting down on production, experts say food prices across the country are set to surge.

“We are going to see a food price surge with these fresh waves of increases in fertilisers, transportation costs, and energy in a period where several farmers don’t plan returning to farms,” said Shehu Bello, national publicity secretary of the All Farmers Association of Nigeria.

“Household pressure is going to intensify,” he said, adding that prices of imported foods will also surge as Nigeria is not in isolation from the impact.

Nigeria’s food inflation, the major driver of headline inflation, has slowed to its lowest in six months, from 25.3 percent in August 2025 to 8.9 percent in January 2026. However, the gains made in achieving a single-digit inflation may be reversed as household pressures renew amid the Iran war.

Read also: Demand for Dangote fertiliser rises amid US-Iran war

BusinessDay market surveys in Lagos and Ibadan show that the average price of a 50kg bag of urea sells for N36,600 as against N33,000 sold a week ago, indicating a 10.6 percent surge in price.

While 50 kg of NPK fertilisers, mostly used by smallholder farmers in the country, which also include urea as part of its component, have been relatively stable since last week at an average of N53,000 per 50kg bag.

Gideon Negedu, former executive secretary of the Fertiliser Producers Suppliers Association of Nigeria, said that despite Nigeria having a comparative advantage in urea production, prices are expected to surge because it is internationally priced.

“We are not at risk for the supply of urea because we produce it locally.” “We are only going to see price increases because fertilisers are internationally priced and this will renew the surge in food prices.”

While Nigeria is rich in urea fertiliser blend, it imports 34 percent of the raw materials needed to produce a critical blend of fertiliser called NPK.

The country gets all its diammonium phosphate (DAP) from Morocco, muriate of potash from Russia, and granular ammonium sulphate from China. All three raw materials and urea are used to produce NPK blends.

It is expected that the prices of the various NPK blends will equally surge in the following weeks when farmers in the Southwest, Southeast, and South regions prepare for next month’s planting season.

Toheed Moufak, an agro- dealer, said that key distributors stopped taking payments for any NPK blends in anticipation of an increase from blenders in the country.

“The distributors are expecting fertiliser blenders to start hiking prices any moment, so they are refusing payments for NPKs because they don’t want to trade at a loss,” Moufak said.

“It is only the nitrogen-based fertiliser producers that have hiked their prices at the moment,” he added.

Read also: Fertilizer prices may spike as Iran bans food, agricultural exports

A boon for local producers

Nigerian fertiliser producers are seeing a surge in demand for their urea and ammonia owing to the Iran war. The surge is expected to boost their profits and foreign exchange earnings.

“We have seen a consistent increase in orders since the Iran war,” said an employee at one of the petrochemical plants who is not authorised to speak on the issue. “But we are prioritising our customers before we take those orders,” he added.

Nigeria has three urea production plants – Notore, Indorama, and Dangote, with a collective capacity of 6.5 million metric tons. These facilities are currently operational and collectively produced approximately 3.65 million Metric Tons (MT) of urea in 2023, according to the most recent data from the Africa Fertiliser.

Also, the surge is expected to boost the country’s export earnings. The country earned $850 million from urea exports in 2024, according to UN Comtrade data.

“For our local urea industry, it is a boon. Production must increase to meet the rising demand,” Negedu said.

Government urged to act now

To cushion the impact of the war on households, experts have urged the federal government to act now.

“We need shock-absorbing measures to address the issue, and the government must start acting now to prevent a spiral effect,” Bello said. “The government must subsidise inputs for farmers, so they are encouraged to return to the farm,” he said.

AfricanFarmer Mogaji, chief executive officer at Agbado Value-Chain Ltd, said the surge in food prices is inevitable; however, he noted that with government intervention, the impact will be reduced.

He added that he heard that the government has started working to address the issue by distributing fertilisers at subsidised rates to farmers.