Fertilizer: Navigating a Volatile Phosphorus and Potassium Market in 2027

Fertilizer decisions are rarely simple. The current phosphorus and potassium market outlook is creating an especially difficult planning environment for growers and their ag retail advisors. Input costs remain elevated. Commodity prices, even with recent rebounds, continue to pressure farm margins. Global supply chains are facing disruptions that extend well beyond agriculture.

From an agronomic perspective, however, the central challenge is not simply determining whether fertilizer prices are high or low. It is understanding what happens in the field when phosphorus and potassium applications repeatedly fall below crop removal and deciding how to protect future productivity without losing sight of current economics.

Why the Phosphate Market Is Under Pressure

One of the biggest forces affecting the phosphate market right now is sulfur.

Sulfur is an essential crop nutrient, but it is also required to transform phosphate rock into phosphoric acid that is used in phosphate fertilizer.

The challenge we’re facing heading into the 2027 growing season is that most of the world’s sulfur is produced as a by-product of oil refining. When geopolitical events restrict the movement of oil and refined products, sulfur supplies can also become tighter. Meanwhile, sulfur demand from upstream raw materials to produce electronics, energy storage, and other sectors has increased significantly, creating more competition for global supplies and driving prices even higher.

In fact, sulfur prices are up over 1,000% since 2024, according to information from official commercial reports by major fertilizer producers such as The Mosaic Co. and global energy intelligence reports from S&P Global Commodity Insights. As sulfur prices rise, the cost of manufacturing phosphate fertilizer rises with them, with prices 36% higher in that same timeframe. Transportation constraints, river conditions, drought, and other supply chain disruptions can add further pressure to availability and delivered fertilizer costs.

Compounding this issue is the fact that the North American phosphate market is competing within a global fertilizer system. Large producers of phosphate fertilizer, such as China, Morocco, Brazil, Russia, and the U.S., have curbed manufacturing because of the high cost or lack of available sulfur. From a domestic perspective, North American buyers may find it difficult to secure a volume of phosphate fertilizer at a specific time because of these global levers. When phosphate fertilizers command higher prices in other parts of the world, products manufactured outside North America may be directed toward markets offering a greater return.

Together, these higher product costs and supply limitations suggest phosphate prices are likely to remain elevated for the foreseeable future.

Potash Creates an Opportunity, but Not a Substitute

The potash market is more favorable for crop production. That may give growers an opportunity to catch up on potassium applications that were reduced in the past or address another part of the crop nutrition program.

However, potassium cannot replace phosphorus.

Crops require a balance among nutrients, including nitrogen, potassium, sulfur, and phosphorus. The plant does not respond to the economics behind the fertilizer decision. Applying more nitrogen, potassium, or sulfur will not allow the crop to overcome an inadequate supply of phosphorus. More of one nutrient does not fix a shortage of another.

On the other hand, a phosphorus limitation should not become a reason to reduce every other nutrient to the same level. If growers cannot secure or apply their full desired phosphorus rate, they should not automatically cut the rest of their nutrients as well. Lowering the entire fertility base also lowers the yield base the grower is working toward.

The Agronomic Cost of Reduced Applications

These market conditions are developing after several years in which many growers have already reduced phosphorus applications.

With crop prices under pressure and fertilizer representing a significant portion of production costs, some growers may have relied on existing soil fertility and applied less phosphorus than the harvested crop removed.

In a single year and viewed in isolation, that decision may have worked. The problem is that many acres have experienced repeated reductions over several years. In other cases, growers made one deeper cut with the intention of making up the difference later.

Now, that future correction continues to be pushed back.

Consequently, the current fertilizer market presents a difficult agronomic question. Growers who have reduced applications during the previous three or four years may now face higher phosphate prices while commodity prices remain subdued, and their soils have less room to support another below-removal application.

Three Paths for Managing Volatile Fertilizer Markets

The current outlook leaves growers with three broad choices:

1. Pay what the market demands and apply enough fertilizer to meet crop removal needs.
2. Seek an alternate nutrient source, such as livestock manure. However, greater demand for manure could increase its value and reduce local availability.
3. Evolve your fertility plans and adopt new tools such as bio-crop nutrition products.

This third option means no longer viewing biologicals as optional or as a separate part of the crop production system. Incorporating soil biology and bio-crop nutrition products into the overall fertility strategy can help access phosphate and other nutrients already present in the soil.

The long-term fertilizer outlook points to continued uncertainty. Supply constraints, industrial sulfur demand, geopolitical pressures, transportation challenges, and global fertilizer competition may continue to affect the market. At the same time, many growers are entering the next crop cycle with tighter margins and soil fertility reserves that may already be declining. Continuing with reduced fertilizer rates will only create even greater fertility challenges for future growing seasons.

Building Fertility Plans for the Reality Ahead

It is important to remember that doing nothing is not a fertility plan. Skipping fertilizer for another year does not make the challenge disappear. It allows soil test levels to decline further and increases the likelihood that nutrient availability will become the limiting factor in crop production.

That’s why ag retailers need to work with their growers to make the best plan possible with the products, nutrient sources and approaches available. The goal is to throw out the status quo. The market currently demands a new approach to crop nutrition, and retailers need to build programs that incorporate several different tools rather than just the typical fertilizer products.

Fertilizer prices will continue to change. The nutrient requirements of the crop will not. Maintaining a long-term perspective can help growers navigate the current market without creating a larger and more expensive fertility challenge in the future.