A recent study conducted by ONE Wealth Management assesses the implications of a potential closure of the Strait of Hormuz on the global fertilizer market, particularly focusing on Brazil. As the world's largest importer of fertilizers, Brazil relies heavily on foreign sources for its agricultural needs, with between 85% to 88% of its fertilizer coming from abroad. The study indicates that costs for the 2026-2027 crop cycle could increase by 7% to 10% as a direct consequence of this closure, which could disrupt established supply routes.

The Strait of Hormuz is a critical maritime passageway, accounting for 25% to 30% of the global supply of nitrogen fertilizers. A closure, instigated by escalating conflicts involving Iran, Israel, and the U.S. starting in March 2026, would force cargo ships to reroute around the Cape of Good Hope, adding significant transit time of up to three weeks. This disruption not only extends the shipping duration but also inflates transportation costs and insurance premiums, further straining Brazil's already vulnerable import situation.

Additionally, operational interruptions from major exporters, such as Qatar Energy halting operations in Ras Laffan, exacerbate the situation by compounding supply chain issues. Brazil, which imported 45.5 million tons of fertilizer in 2025, could face substantial challenges in securing the necessary quantities at manageable prices, raising concerns among agricultural producers about the potential effects on food production and pricing.