Fertiliser prices

Fertiliser is used primarily in agricultural applications, making downstream farming the lead source of demand. Natural gas is a critical input in the energy-intensive production of nitrogenous fertiliser, the most widely used type, accounting for an estimated 60–80% of nitrogen fertiliser production costs. It is used in the synthesis of ammonia, which forms the basis of all nitrogen fertilisers.

Over the five years through 2025-26, prices grew at a compound annual rate of 10.7%. The period opened with a sharp price surge following the Russian invasion of Ukraine in 2022, which severely disrupted European gas supplies, compounding the effects of tight global supply already pushing energy prices higher. After a period of easing in 2023–24, prices began rising again in 2025, driven by tight global supply conditions and increased production costs. This was further amplified by lower-than-usual UK and EU gas storage levels and renewed geopolitical tensions in the Middle East, with gas prices rising sharply in early 2026. The US-Iran conflict in early 2026 has disrupted exports of liquified natural gas from Qatar, a crucial supplier of natural gas to Europe and other parts of the world. The UK market's heavy reliance on imported fertilisers continues to leave prices exposed to currency weakness and global supply disruptions.