Russia Moves to Tax Fertilizer Windfalls as US DAP Quotes Near $962 and Urea Freight Stays Snarled
Moscow has proposed higher taxes on excess profits in the metals and fertilizer sectors on the back of elevated global prices, while US phosphate and nitrogen quotes remain historically firm and physical urea availability is still dictated by what can move through the Strait of Hormuz.
Russia's finance ministry has proposed raising taxes on what it described as excess profits in the metals and fertilizer sectors, citing high global prices, as part of the draft 2027-2029 budget that projects a deficit of around 2% of GDP. The proposal matters well beyond Russian fiscal arithmetic: Russia is among the world's largest exporters of urea, potash and phosphate fertilizers, so any tax that changes netbacks or export incentives feeds directly into global nutrient pricing.
In the United States, fertilizer price tracking shows the phosphate complex at the top of the range. DAP was quoted at $961.83 a short ton and MAP at $1,016.23, while UAN 28% stood at $600.00, anhydrous ammonia at $815.50, ammonium sulfate at $580.55 and potash at $535.20. Nitrogen products have been drifting lower from their earlier peaks, but phosphates remain elevated because sulphur and phosphoric acid input costs are still far above normal levels.
The sulphur chain is the underlying constraint. Landed sulphur prices have roughly doubled since the start of the year to around $1,100 a tonne as Ukrainian strikes on Russian refineries cut supply and as West Asian producers ship less through the Strait of Hormuz, which normally carries close to a third of global fertilizer trade. Higher sulphur costs raise the production cost of DAP, single super phosphate and complex fertilizers because sulphuric acid is required to convert rock phosphate into phosphoric acid.
Buyers are responding by prioritising availability over price. Indian officials have warned publicly about significant fertilizer shortages ahead of the rabi season, and freight rather than production is now the binding variable, with a large volume of urea reported to be sitting aboard vessels unable to transit the Gulf. China has stepped in as the marginal supplier, but export intentions rather than nameplate capacity determine what actually reaches importing markets in the fourth quarter.