Agriculture Market Forecast: Top Trends for Potash and Phosphate in 2025

How will US tariffs impact fertilizer prices?

Trump administration trade tariffs could be a key factor for the fertilizer sector in 2025.

During his campaign, Trump was vocal about using tariffs to level trade imbalances, often singling out China. However, in December, he began to propose 25 percent tariffs on all goods imported from Canada into the US.

Since he made these statements, there has been no indication of any carve-outs for fertilizers.

Canada is the world’s largest producer of potash, and any tariffs could upset the amount sent to the US, potentially leading to higher prices downstream for farmers and for food supply in general.

In an email to the Investing News Network, Josh Linville, vice president of fertilizer at StoneX, explained that the US is heavily reliant on imports from Canada and Russia, and tariffs on either would be felt immediately.

“Of the near 15 million metric tons (MT) of potash imported to the US last year, almost 13 million of those originated from Canada … Russia, another possible tariff target for the incoming administration, accounted for 1.5 million MT last year. While the US does produce potash, it is not nearly large enough to meet our demand,” he said.

Linville also outlined how reliant Canadian producers are on US ports to reach the rest of the world, noting that 4.4 million MT of potash were exported from the country. Even if Canadian potash isn’t being consumed in the US, it is still subject to tariffs when it crosses the border, making it more expensive for the end buyer.

Phosphate is likely to be affected by tariffs as well. As Linville outlined, the US and four other countries are responsible for 85 to 90 percent of the world’s phosphate supply. Trump placed tariffs on China during his first term in office, while Biden placed Morocco and Russia under tariffs during his time in the White House.

“That leaves Saudi Arabia as the lone wolf that can still target the US unencumbered, and they have plenty of global buyers they can target. At this time, we do not expect this situation to change in 2025, which should keep the US in line to slightly higher than the rest of the world,” Linville explained to INN.

Potash supply ample, phosphate market remains tight

The potash market was relatively quiet in 2024, with more than enough supply to meet demand. Barring any major developments, that scenario is expected to continue through 2025.

“It is very hard to see an outlook that includes much price appreciation in the potash sector. While there have been some fears that supplies would be cut, with the speech by the Belarusian president floating production curtailments in response to low prices, no other major manufacturers have been heard following his lead,” Linville said.

It is uncertain whether that situation will continue past 2025. New projects are in the pipeline, including BHP’s (ASX:BHP,NYSE:BHP,LSE:BHP) C$14 billion Saskatchewan-based Jansen potash mine, which is set to come online in late 2026. Once completed, the operation will produce 8.5 million MT of potash annually.

Linville also pointed to Russia, which is looking to expand its production.

Meanwhile, China has been working to expand its operations in Laos; however, in early January, the Laotian government ordered the closure of a mine operated by Sino-Agri International Potash after sinkholes formed nearby.

While the potash market remains straightforward and stable, the phosphate sector is more dynamic.

China, which controls 30 percent of the market for the material, began issuing export quotas in the middle of 2022 that were well below the numbers seen in 2021. The cuts came at a time when prices for major fertilizers were near record highs, with phosphate rising above US$1,000 per MT. The country imposed further restrictions on exports in 2023, and then did so again in 2024 as domestic prices failed to stabilize.

There are other factors impacting the supply and demand of phosphate too

“The government (was) slow to respond to a changing market, and stockpiles got close to the levels seen in late 2021, when the agricultural market rioted in response,” Linville said.

The government responded quickly, and has been a major buyer since, but Linville said stockpiles remain lower than normal. Meanwhile, production in the US was hit by the dual impact of hurricanes Milton and Helene.

Unlike potash, there is only one notable phosphate project, the Eigersund project in Rogaland, Norway. Owned by Norge Mining, a subsidiary of Nordic Mining (OL:NOM), the site hosts a significant phosphate resource, alongside vanadium and titanium. If it is successfully brought online, production will still not start at the site for several years.

When it does, the impact on the agriculture industry will be uncertain, with Linville suspecting much of the phosphate will be destined for the battery industry.

Investor takeaway

According to Linville, prices for potash are unlikely to see much change. “Today, the 2025 outlook is more of the same. It is very hard to see an outlook that includes much price appreciation in the sector,” he said.

For phosphate, Linville outlined a picture that is also a continuation of 2024.

“The 2025 outlook continues to paint phosphate at higher price levels. We expect that Chinese exports will continue to be lower than normal and global demand to look decent. I will not be surprised to see a seasonal summer low on values, but any hope of seeing prices down significantly are hard to hold,” Linville said.