Can seasonal patterns help inform fertilizer purchasing decisions?

As producers turn their attention to the 2027 growing season, buying fertilizer remains one of the most important—and uncertain—crop input decisions. The return of Chinese fertilizer exports has improved supply prospects for some nutrients, but ongoing geopolitical tensions in the Middle East and the potential for disruptions to trade through the Strait of Hormuz continue to create upside price risk. At the same time, energy markets and global trade flows remain important drivers of fertilizer costs.

Against this backdrop, one question consistently comes up: How should producers approach fertilizer purchases in an increasingly uncertain market? In this report, we examine current fertilizer market conditions and explore how historical pricing patterns can help inform purchasing decisions amid ongoing uncertainty.

Fertilizer markets are sending mixed signals

Current market indicators highlight the diverging outlooks for nitrogen and phosphate fertilizers heading into 2027. Urea prices in the U.S. Gulf fertilizer market have retreated significantly from the highs reached earlier in 2026 and now sit roughly 15% below pre-conflict levels, while DAP prices at New Orleans (NOLA) remain approximately 25% above pre-conflict levels (Figure 1). The contrast highlights the different forces shaping nitrogen and phosphate markets. Unlike nitrogen and phosphate, potash prices have remained comparatively stable over the past year.

While Canadian fertilizer prices generally follow U.S. Gulf and NOLA benchmarks, transportation costs, exchange rates, regional supply-demand conditions, and retailer inventories can influence the extent and timing of price changes. As a result, declines in benchmark prices do not necessarily translate into equivalent reductions in Canadian fertilizer prices.

Figure 1: U.S. fertilizer markets diverge: Urea retreats while phosphate remains firm

Nitrogen markets easing, but risks remain

Part of the decline in urea prices reflects the seasonal slowdown that follows North American planting, a period often referred to as the summer lull in fertilizer markets. Prices have also softened due to the return of Chinese urea exports after several years of limited participation in global markets, improving product availability and easing pressure on nitrogen prices.

However, lower nitrogen prices should not be mistaken for lower risk. The Middle East remains a critical supplier of fertilizer products, feedstocks and energy, while the Strait of Hormuz remains a key global trade route. Any disruption to regional trade flows, shipping routes or natural gas markets could quickly reverse recent price declines.

Phosphate markets remain fundamentally tight

Phosphate markets continue to tell a different story. Elevated costs for sulphur, ammonia, and natural gas—the primary inputs in phosphate production—have squeezed producer margins. So much so that in some cases, phosphate production has even been curtailed. With the Middle East accounting for nearly half of global sulphur trade, ongoing conflict in the region risks further increasing phosphate production costs and constraining supply.

Also supporting phosphate prices is the uncertainty surrounding Chinese exports. While lower U.S. tariffs on Moroccan phosphate may encourage some additional North American imports, they are unlikely to materially loosen global market conditions. Chinese export policy remains a key watch item heading into 2027.

Managing uncertainty through purchasing decisions

With fertilizer prices remaining difficult to predict, many farms are focusing on timing of purchases as a risk management tool. Most farms know their expected crop rotation and fertilizer requirements well before spring, and while prices remain uncertain, historical seasonal patterns can provide useful context for purchasing decisions.

Nitrogen exhibits the strongest seasonality of the major fertilizers (Figure 2). Over the past five years, Canadian retail prices have typically been the weakest during late summer and fall before strengthening into the spring application season, with average values peaking in April and May.

Figure 2: Nitrogen prices tend to strengthen into spring

Phosphate displays a more moderate but still noticeable seasonal pattern (Figure 3). Prices for Canadian farmers tend to be relatively softer during the second half of the calendar year before gradually strengthening ahead of spring seeding.

Figure 3: Phosphate prices also show seasonal spring strength

In contrast, Canadian potash retail prices have exhibited relatively modest seasonal price fluctuations in recent years, giving producers greater flexibility to manage cash flow.

After summer fill programs, farmers are typically left weighing purchases between fall and spring application windows. Those with storage capacity may be able to separate purchase timing from application timing, while others may use supplier programs that allow fertilizer to be priced ahead of delivery.

Recent experience highlights why these decisions matter. Many producers viewed fertilizer prices as unattractive during summer fill programs last year, resulting in limited uptake. Fall fertilizer application was also weaker than normal, pushing a larger share of fertilizer demand into the winter and spring months.

Fertilizer purchasing decisions should also be considered alongside grain marketing plans. As discussed in our recent grains and oilseeds report, historical crop pricing patterns can help inform grain marketing decisions amid market uncertainty. Locking in favourable crop prices can help offset higher fertilizer costs and improve margin certainty heading into 2027.

Bottom line

Geopolitical events this past year have highlighted how quickly fertilizer market conditions can change. Historical pricing patterns suggest nitrogen and phosphate prices often strengthen into the spring application season, contrasting with potash prices which tend to show greater stability. While there is no guarantee markets will follow their typical seasonal path, the latter can be useful in guiding fertilizer purchasing decisions.

Many producers appear to be taking a wait-and-see approach as fertilizer markets move through the fall and into the new year. Given the uncertainty that remains, a phased purchasing strategy may be worth considering. While it will not always result in the lowest price, it can help balance opportunity, risk and flexibility.