MOS

Global food prices are at their highest since 2022, driven by a collapse in Brazilian sugar supply and disrupted Russia-Ukraine trade. Farmers worldwide are racing to restore yields. That speeds up demand for the fertilizer and crop chemicals sold by Corteva, CF Industries and Mosaic.

Iran's Hormuz conditions risk prolonged gas flow disruptions, crushing offshore ammonia/urea production economics. Global fertilizer supply tightens into fall application season. US fertilizer producers with Henry Hub-linked feedstock costs are the non-obvious beneficiary. Long US large- and mid-cap nitrogen and potash producers.

Hormuz restrictions spike energy prices, but the real unpriced move is in nitrogen fertilizer: Haber-Bosch production is gas-dependent, and a sustained gas/oil shock tightens global fertilizer supply already strained post-Russia/Ukraine. Long North American fertilizer producers with domestic gas exposure as the market focuses only on oil.

Iran closing the Strait of Hormuz cuts Qatar LNG and Gulf gas exports, spiking the feedstock cost for nitrogen fertilizer globally. North American producers like CF Industries and Nutrien, who source gas domestically at Henry Hub prices, gain a massive structural cost advantage over now-crippled Middle Eastern and Asian competitors. Long large-cap North American nitrogen fertilizer producers.

Hormuz disruption keeps energy costs elevated globally, but the non-obvious transmission runs through fertilizer: natural gas is 70-80% of nitrogen fertilizer production cost. High-cost European/Asian producers shut in capacity, tightening global supply. Long North American nitrogen fertilizer producers who source cheap domestic gas while selling into a supply-squeezed global market.

JPM sees oil stuck above $100 regardless of Hormuz resolution — a structural floor, not a spike. Sustained high energy costs crush nitrogen fertilizer margins for high-cost producers, tightening global supply. The non-obvious long is North American fertilizer producers with low-cost natural gas access and pricing power in a supply-constrained market.

Iran war is draining global oil buffers at record speed, but the real trade isn't crude — it's fertilizer. Gas-dependent ammonia production faces a supply squeeze as Middle East energy flows tighten, lifting North American fertilizer producers with cheap domestic gas feedstock advantages. Long Canadian and US-listed fertilizer and ag input names.

Geopolitical oil shock transmutes into fertilizer supply crisis, triggering government ag subsidies that create durable demand for nitrogen producers and seed-tech companies.

Hormuz blockade threat spikes natural gas costs, crushing margins for high-cost fertilizer producers like CF and NTR—long commodity fertilizer spot prices, short integrated producers.

Ceasefire collapses energy premiums, deflating fertilizer costs temporarily but unlocking deferred ag demand globally. Long fertilizer producers.