Why It Matters
North Dakota corn farmers are confronting compounding economic pressures as conflict in the Middle East disrupts global fertilizer supply chains and drives up input costs. The state’s agricultural sector, already struggling through a fourth consecutive year of negative yields due to low commodity prices and elevated fertilizer expenses, now faces additional strain from geopolitical instability affecting phosphate availability and pricing. The disruption threatens farm profitability across the region and has prompted industry leaders to call for immediate congressional action on fuel standards and trade policy.
What Happened
The National Corn Growers Association renewed its calls to Congress this week for two policy changes: nationwide legalization of year-round E-15 fuel blends and removal of tariffs on fertilizers imported from Morocco. The action came as Iran blocked the Strait of Hormuz, a critical 30-mile-wide shipping channel connecting Middle Eastern oil, natural gas, and fertilizer producers to international markets. The blockade was initiated in response to joint military strikes on Iran by the United States and Israel.
Lesly McNitt, vice president of public policy for the National Corn Growers Association, stated during a press conference that the geopolitical crisis has “further complicated access to critical fertilizers.” The United States typically imports approximately 40 percent of its phosphate products from Saudi Arabia, making the Strait of Hormuz closure a direct threat to domestic agricultural operations. McNitt emphasized that the U.S. lacks sufficient domestic fertilizer production to meet demand, making imports essential to farming operations across North Dakota and other major agricultural states.
The Fertilizer Institute warned that the strait’s closure could disrupt markets for ammonia, urea, sulfur, phosphates, and natural gas. Supply interruptions in one region of the world affect trade routes and pricing globally, meaning that Middle Eastern geopolitical instability directly impacts costs for North Dakota farmers.
By The Numbers
A study by the Agricultural and Food Policy Center at Texas A&M University found that countervailing duties imposed on phosphate products in 2020 increased phosphorus costs by approximately $6.9 billion across the 2021 to 2025 growing seasons. The U.S. typically imports about 40 percent of its phosphate products from Saudi Arabia, a nation whose ports may be impacted by the Strait of Hormuz blockade. Corn farmers are entering their fourth consecutive year of negative yields. North Dakota expanded its agricultural relief programs to $500 million in response to ongoing farm stress, adding $100 million to existing assistance initiatives.
Zoom Out
The Middle East conflict represents the latest external shock to U.S. agriculture, which has faced persistent headwinds since 2023. Low corn prices and high input costs have created a squeeze on farm incomes nationwide, particularly in major corn-producing states like North Dakota, Iowa, and Illinois. The situation mirrors broader vulnerabilities in global agricultural supply chains exposed during the COVID-19 pandemic and the 2022 Russian invasion of Ukraine, which disrupted fertilizer supplies and elevated costs across North America.
Fertilizer tariffs have been a contentious policy issue for years. The 2020 duties on phosphate from Morocco and Russia were designed to protect domestic producers but have created persistent cost burdens for farmers dependent on imported nutrients. The closure of the Strait of Hormuz threatens to amplify these existing trade constraints, creating a dual pressure on input availability and pricing.
North Dakota’s expanded agricultural relief program signals state-level recognition of the sector’s financial distress. The $500 million investment reflects broader concerns about farm viability across the Great Plains as commodity prices remain depressed relative to production costs.
What’s Next
The National Corn Growers Association’s renewed push for year-round E-15 legalization and tariff removal will face congressional consideration. Currently, E-15 fuel blends face seasonal restrictions in certain states. Nationwide approval could reduce fuel costs for farmers using higher ethanol blends, partially offsetting input expenses.
The geopolitical situation surrounding the Strait of Hormuz remains fluid, and any prolonged blockade would likely trigger additional fertilizer price increases. The Fertilizer Institute and agricultural groups are expected to continue monitoring supply chain impacts and pressure policymakers for emergency trade relief measures.
North Dakota and other agricultural states may pursue additional state-level assistance programs if conditions deteriorate further. Congressional action on tariff policy and fuel standards will determine whether farmers receive cost relief in the near term.