Yara International has warned that fertiliser purchasing for the 2027 season is running significantly behind historical norms across Europe, the US and Brazil, potentially setting up a period of market tightness ahead of spring applications.
Deferred demand raises market uncertainty
Speaking during the company’s third-quarter earnings call, CEO Svein Tore Holsether said farmers had yet to buy substantial volumes needed for the upcoming season, despite improving crop economics and strengthening grain prices.
“Purchasing for the 2027 season is lagging in Europe, in the US and Brazil, leaving significant volume still to be bought as the Northern Hemisphere application season approaches,” he said.
The delayed buying comes after a turbulent year for fertiliser markets, shaped by Middle East supply disruptions, weaker crop prices earlier in the season and uncertainty over farmer affordability.
Yara sees demand returning
Despite the slow start, management said there is little evidence that farmers are planning to significantly reduce nutrient applications next season.
During the analyst Q&A, Holsether said nitrogen affordability has improved compared with earlier in 2026, while crop prices remain stronger than six months ago.
“If you think about 2027 with improved affordability ratios for nitrogen in particular, you would logically expect an increase in demand and not a further rationing,” he said.
Chief financial officer Magnus Krogh Ankarstrand added that buying patterns remain well behind normal seasonal levels, but improving crop prices suggest there is “no reason to think” demand will fall dramatically across the Northern Hemisphere.
Yara reported that European nitrogen deliveries increased 4% year-on-year during the quarter, even as the wider market contracted by an estimated 5-10%. The company also highlighted a strong nitrate order book and improving purchasing activity in Europe following a slow start to the season.
Supply risks remain
Management suggested the delayed purchasing could become more significant if supply remains constrained.
The company noted that fertiliser imports into key consuming regions remain well below usual levels. European imports for the coming season are down around 30% year-on-year, while Brazilian imports of urea and ammonium sulphate have also fallen.
At the same time, supply uncertainty persists due to reduced exports through the Strait of Hormuz and widespread ammonia production curtailments in Europe caused by high gas prices.
Holsether said Yara is closely watching how the market develops heading into spring.
“We have not seen position taking in European markets, in Latin American markets, in North American markets,” he said. “There is a lot of demand that remains.”
Profit hit by gas costs
The warning on fertiliser buying came as Yara reported third-quarter EBITDA excluding special items of $675m, down from $804m a year earlier.
The company said higher European gas costs, lower volumes and operational reliability issues weighed on earnings, although it maintained its EBITDA improvement targets and said the planned Gulf Coast Ammonia acquisition would further diversify its energy exposure.
