New Export Restrictions on Fertilizers and Staple Crops Reignite Supply Risk for Global Agriculture

New or tightening export controls on key fertilizers and wheat-based products are adding fresh strain to already fragile global agricultural supply chains, with traders bracing for renewed price and logistics volatility into the 2026/27 season.

Recent moves include ongoing Chinese restrictions on phosphate fertilizer exports and tighter licensing and quota management on wheat flour exports from India, while Russia and the Eurasian Economic Union (EAEU) maintain quantitative limits on outbound fertilizer shipments. Together, these policies are reshaping trade flows for nitrogen and phosphate inputs and related grain products at a time of elevated geopolitical and freight risk.

Introduction

Several large exporting economies have either introduced or prolonged export bans, quotas, or licensing regimes on fertilizers and selected agricultural goods. China has extended curbs on exports of key phosphate fertilizers at least through August 2026, while Russia is enforcing temporary quantitative limits on certain fertilizer exports under a government decree adopted in April.

India, a pivotal actor in wheat and wheat flour trade, is meanwhile reviewing and reallocating country and firm-level export quotas for wheat flour and related products, with exporters required to demonstrate utilization to retain access. These overlapping measures come as fertilizer prices remain elevated following the Strait of Hormuz crisis, which has already driven a sharp rise in urea and diammonium phosphate (DAP) prices since early 2026.

Immediate Market Impact

Export licensing and quota regimes are limiting available spot volumes of urea, DAP, and monoammonium phosphate (MAP) from China and Russia, forcing import-dependent regions to source more product from alternative suppliers such as North Africa, the Middle East, and North America. Industry testimony in May highlighted that China is not exporting MAP, DAP and triple superphosphate until at least August 2026, effectively removing a major share of seaborne phosphate supply from the global market.

This tightening of exportable fertilizer supply has already contributed to strong price gains: urea prices were reported up roughly 50% since the onset of the Hormuz conflict, with DAP and other products also higher. On the grains side, India’s closer management of wheat flour export quotas adds friction to South and West Asian flour trade, with exporters facing administrative risk and the potential for quota non-renewal if volumes are not shipped on schedule.

Supply Chain Disruptions

Export controls on fertilizers are amplifying logistical and planning uncertainties for distributors and farmers. Buyers in Latin America, Sub-Saharan Africa and parts of Asia that historically relied heavily on Chinese phosphate have had to secure alternative origins, often at higher freight and product costs, and with longer lead times. Industry representatives have warned U.S. policymakers that Chinese restrictions are exacerbating the global shortfall in high-analysis phosphate supply.

Russia’s temporary quantitative limits on specific fertilizer categories, administered via export quotas and licensing, have similarly complicated shipment scheduling from Black Sea ports, increasing the risk of port congestion and contract rollovers. For wheat flour, India’s quota review requires exporters to submit utilization data by early July, with the risk that unused quota may be reallocated to other firms, potentially disrupting established supply chains to key destinations in South Asia and the Middle East.

Commodities Potentially Affected

• Urea: Tight global nitrogen availability following Hormuz-related shipping disruptions and policy controls is supporting higher prices and raising input costs for cereal and oilseed producers.
• DAP and MAP: Chinese export restrictions on MAP, DAP and TSP through at least August 2026 are limiting seaborne phosphate supply, particularly affecting Asian and African importers.
• Mixed NPK fertilizers: Licensing and quota regimes that cover complex fertilizers containing nitrogen, phosphorus and potassium increase formulation and sourcing challenges for blenders and cooperatives.
• Wheat flour and related products: India’s review and potential reallocation of export quotas for wheat flour and derivatives could disrupt shipments to traditional buyers in neighboring and food-insecure markets.
• Other mineral fertilizers (potash, compound products): EAEU quota allocation rules for mineral fertilizer exports create additional administrative hurdles that can slow contracting and execution.

Regional Trade Implications

Asia and Africa are the most exposed to fertilizer export restrictions, given their heavy reliance on imported nitrogen and phosphate. The effective withdrawal of much Chinese phosphate from world markets shifts incremental demand toward producers in Morocco, the United States, Saudi Arabia and other MENA exporters, with the EU temporarily suspending customs tariffs on some fertilizers to secure supply at competitive prices.

In grains, tighter and more closely monitored Indian wheat flour exports could open opportunities for mills in Turkey, the EU and the Black Sea region to serve markets in the Middle East, East Africa and parts of Asia, particularly for higher-value flour blends. However, buyers may face higher landed costs and more volatile freight and premiums than under India’s earlier, more predictable export regime.

Within the EAEU, rules for allocating export quotas on mineral fertilizers may favor well-capitalized traders able to navigate licensing systems, while smaller firms could be squeezed out of cross-border trade. Importers in Latin America and South Asia are likely to deepen relationships with North American and North African suppliers to diversify away from Russia and China, a shift that could persist even if current restrictions are eased.

Market Outlook

In the short term, fertilizer and wheat markets are set to remain volatile as traders digest evolving policy signals from key exporting countries. The combination of Chinese phosphate curbs, Russian and EAEU quota systems, and quota management on Indian wheat flour exports is likely to keep basis levels firm for nearby delivery windows and sustain a risk premium in forward prices.

Market participants will watch closely for any relaxation of export controls after August 2026 in China, adjustments to Russian fertilizer quotas, and India’s decisions on renewing or reallocating wheat flour export quotas beyond the current review period. Alongside these policy variables, traders will monitor freight availability and credit conditions, which can further amplify the price impact of any sudden tightening or loosening of export licensing regimes.

CMB Market Insight

The latest wave of export bans, quotas and licensing constraints underscores how trade policy has become a core driver of agricultural and fertilizer market risk. For import-dependent countries and commercial buyers, reliance on a narrow set of origins for critical inputs and staples now carries heightened exposure to sudden policy shifts.

Strategically, traders and end-users are likely to accelerate diversification of sourcing, expand the use of long-term contracts with reliable exporters, and increase hedging against both price and basis risk. Until major exporters signal a decisive move back toward more open fertilizer and staple crop trade, elevated volatility and structurally higher risk premiums are set to remain key features of global agricultural markets.