The closure of the Strait of Hormuz by Iran following the start of U.S.-Israel attacks on the country is also concerning the fertilizer market. Nitrogen fertilizer production requires large amounts of natural gas, meaning the price of one is directly dependent on the other.

Baltic Agro Development Director Margus Ameerikas said: "When the war started, in the first days some larger companies even stopped selling fertilizers, and we were forced to issue a new price list almost every day, because prices were rising so quickly that the previous day's price was no longer valid."

The price of some fertilizers has already risen by 30 percent to 50 percent.

Estonia's annual fertilizer imports amount to €120 million, which means an approximate increase of €50–60 million.

Ants-Hannes Viira, head of agricultural policy at the Chamber of Agriculture and Commerce, said: "Today, this most affects farmers who grow grain, both crop producers as well as dairy and livestock farmers. At the moment, the most critical issue is the sowing of spring crops. The sowing period is approaching, fertilizer prices are high, and we see that at current fertilizer prices, sowing spring crops is not very reasonable, because there is a very high likelihood of losses."

A similar situation is seen elsewhere in the world, including the U.S. Midwest.

Economic analyst Arlan Suderman said: "If the war ends tomorrow or next week and the Strait of Hormuz is reopened, prices will fall fairly quickly. If it continues for another three or four weeks, prices will rise rapidly. Farmers are therefore facing risk. They must decide whether to accept the current price, which limits their options, or take the risk of prices either falling or rising in the coming weeks."

Estonian farmers are fairly well prepared for the spring and summer period and have purchased about 90 percent of the fertilizer they need. But there are concerns about the coming autumn, as fertilizer procurement usually begins in the summer. Farmers are now considering different sowing options, which could reduce grain production.

However, grain prices are not expected to rise quickly as global reserves are currently at a five-year high.

"What will likely happen is that due to high fertilizer prices, grain cultivation and yields will decrease, reserves will decline, and the impact on food prices, grain prices, and milk prices will come with a delay. More likely in the autumn, possibly in winter. We are not seeing price increases today," Viira, from the Chamber of Agriculture and Commerce, said.

He is concerned that the impact of the Iran war could be long-term, as gas processing facilities in the region have also been damaged. Restoring this infrastructure could take significantly longer than reopening the Strait of Hormuz.

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