Urea prices are currently at record levels, owing to cost support from upstream Natural gas and Coal, driving the price trend upward. Following the incursion of Ukraine, Urea markets, particularly west of the Suez Canal, saw a rise, spurred by rising gas prices and supply uncertainties. Russia is the world's largest fertilizer exporter, but its conflict with Ukraine has hindered shipping and raised natural gas costs, a significant element in fertilizer production. Since the invasion began, Urea fertilizers futures have increased by 32% globally.

The prospect of shipments being disrupted comes as fertilizer costs have already been rising because of higher upstream values, which have led some factories to suspend or limit production. As crop costs rise, the jump in the nutrient is fuelling fears of rising food inflation. Rising inflation in the United States has also weighed on the Nitrogen fertilizer prices. FOB Corn Belt prices have remained in a range of USD 1,350 – USD 1,375 per tonne due to lack in domestic demand since the previous significant buying period coupled with excessive volatility in Urea markets.

The few fertilizer players in the market are worried that rising prices will allow them to profit from the situation. The Department of Agriculture in the United States announced that it is seeking information on competition in the fertilizer, seed, agricultural input, and food wholesale and retail markets as part of a public inquiry into concentration in those markets. In the short term, Urea prices are expected to rise due to unprecedented disruptions in the worldwide export market, with effects expected to last into the medium-term or beyond.

As Per ChemAnalyst, "Given the strong fundamentals at play, global Urea prices appear bullish in the short run. Firmer feedstock Ammonia prices and rising Natural gas costs as the Northern Hemisphere enters the spring season have had a significant impact on prices, particularly in the United States. Markets anticipate abundant harvests in the North American spring season, which will help replenish many commodities' depleting global supply. Input costs are projected to soar as farmers in the United States prepare to grow crops."