Russian fertilizer industry: world export champion and crisis profiteer

Russia is the world's largest exporter of fertilizers and is continuing to expand its production. Rising prices as a result of the Middle East war are increasing the revenue potential, but limited capacities, government intervention and political risks are likely to limit the benefits for manufacturers. Model calculations by the German-Russian Chamber of Commerce Abroad show how much the industry and the Russian state could benefit from the price surge. The chamber's focus analysis provides an overview of the most important producers and their business figures. Russian production and exports of fertilizer Russia is one of the leading producers and the largest exporter of fertilizers. Russian fertilizer production in 2025 totalled 65.4 million tonnes of gross weight, reports the Russian Fertilizer Producers Association RAPU, which brings together the largest representatives of the industry, citing data from the statistics authority Rosstat. The country has thus left the USA, India and Canada behind and is now only behind China, commented RAPU boss Andrey Guryev on the figures. Russia has greatly expanded its fertilizer production in recent years. In 2013, it still amounted to 39.7 million tons of raw weight, and RAPU expects a further expansion to 80 million tons by 2030. For comparison: the historical record from 1988 is 37.1 million tons, based on the entire former Soviet Union. This figure does not include the gross weight of the fertilizer, but only the nutrients it actually contains, the so-called 100% nutrient volume. The corresponding figure for 2025 was 30.5 million tons. For the Russian constituent republic of the USSR, scientific studies report a production of 17.3 million tons in 100% volume in 1985, which was below the 2013 result of 18.5 million tons. While other top producers such as China and the USA mainly produce for their own markets, exports predominate among Russian manufacturers. As a result, Russia is by far the largest fertilizer exporter in the world. According to UN trade data, the value of Russian exports amounted to USD 15.3 billion in 2024. China, which also restricts its exports by the state, followed with USD 8.5 billion. This was followed by traditional export countries such as Canada and Morocco with USD 6.7 billion and USD 6.4 billion respectively. In 2025, Russian fertilizer exports will amount to 45 million tonnes in gross weight, with export revenues of 15 billion dollars. This was reported by RAPU with reference to expert estimates. Russia's Agriculture Minister Oksana Lut in a TV interview, however, put exports in 2025 at 43 million tons and 11 billion dollars. Figures from the statistics authority Rosstat on exports are only available up to 2021, when they amounted to 37.5 million tons and USD 12.4 billion respectively, and, like production, exports and revenues have also increased by around 65% since 2013. RAPU expects exports to increase to 58 million tons by 2030. This would increase Russia's share of global trade from 19% in 2025 to 25%. Fertilizer as Russia's top export With export revenues of around 15 billion dollars (13 billion euros), fertilizers have become one of Russia's most important export goods. According to statistics from the Russian customs service, chemicals and plastics accounted for 8.1% of Russian exports in terms of value last year. This put this product group in fourth place, behind oil and gas, metals, food and agricultural products. According to RAPU, fertilizers accounted for 45% of export revenues in this product group, resulting in a 3.6% share of total Russian exports. In addition, export revenues in the chemicals and plastics group as a whole grew by 21.6% last year, which was the second largest increase among the individual product groups. Only the "machinery and vehicles" group grew faster at 26.6%, although this group is also likely to include defense equipment. Russia's strength in the global fertilizer market is due to its wealth of raw materials. It has large deposits of the three main fertilizer types nitrogen, phosphorus and potash, wrote the German magazine Cicero at the end of 2021, when there was a global shortage of fertilizers. This was triggered by a sharp rise in gas prices as a result of the global economic recovery from the Covid pandemic. Natural gas, which is also abundant in Russia, is the raw material for the production of nitrogen-based mineral fertilizer, which consists of 90% natural gas and is basically a "refined gas", as a Tagesschau report explains. Energy crises drive fertilizer prices During the 2021 crisis, the global market price for urea, a form of nitrogen fertilizer, roughly doubled within a few weeks and rose to USD 945 per tonne in early December. After 24 February 2022, the energy and fertilizer crisis worsened, causing the price of urea to briefly soar to USD 1025 per tonne at the beginning of April. The failure of a pipeline that Russia had used to transport large quantities of ammonia through Ukraine to the Black Sea port of Odessa also contributed to this, and a new fertilizer crisis loomed in spring 2026 because the Iran war led to a de facto closure of the Strait of Hormuz, the main transport route for exports from the Gulf region. The price of urea rose from around 430 to 675 dollars per tonne between the end of February and mid-March 2026. During the 2021/2022 fertilizer crisis, fertilizer prices returned to normal from autumn 2022. One factor in the recovery was that Russian fertilizer did not disappear from the market, but was only partially diverted to other buyer countries, explains a recent study by the Center for Agricultural Policy at North Dakota State University. In contrast, there is currently a "physical blockade" of large export quantities of fertilizers in the Gulf region. As long as the Strait of Hormuz cannot be navigated, around 43% of global urea exports transported by ship are threatened. Depending on the duration of the Hormuz closure, fertilizer prices could rise to the record level of 2022 or even higher, the researchers state. The impact of the Hormuz crisis on export earnings and government revenue According to RAPU, the association of Russian fertilizer producers, Russian export revenues rose to USD 19.3 billion (EUR 16.8 billion) in the crisis year 2022, with a relatively low export volume of 32 million tonnes. In mathematical terms, this results in an average price of 603 dollars per ton. Even before the Iran crisis, RAPU forecast total Russian exports in 2026 at 46 million tonnes of fertilizer. If prices reach the level of 2022 throughout the year, Russian export revenues in 2026 could therefore reach USD 27.7 billion, the equivalent of EUR 24 billion. In addition to this simple projection, the analysis team at the German-Russian Chamber of Foreign Trade has calculated and estimated the potential export revenues and state revenues for various price scenarios in more detail. Depending on the level of world market prices for fertilizers, Russia's fertilizer exports could total between 15.9 and 44.9 billion dollars, the equivalent of around 14 to 39 billion euros. In the two middle scenarios, gross export revenues range from 21.4 to 25.2 billion dollars and 18.6 to 21.9 billion euros respectively. The additional export revenue on an annual basis would be USD 6.4 to 10.2 billion higher in the medium scenarios compared to the result for 2025, equivalent to an increase of EUR 5.6 to 8.9 billion. In our maximum shock scenario, which assumes overall higher prices over a longer period than 2022, Russia would generate USD 44.9 billion, the equivalent of EUR 39 billion, from fertilizer exports. Even if the export volume were to fall from the forecast 46 million tons to 30 million tons, the revenues in this scenario would still be almost twice as high as in 2025 at 29.3 billion dollars (25.5 billion euros).The direct state revenues derived from the price scenarios would be between 46 and 247 billion roubles per year, the equivalent of around 474 million to 2.53 billion euros, according to the Chamber's model calculation. In the two middle scenarios, it would be 73 to 101 billion roubles, equivalent to 0.8 to 1.04 billion euros. For 2025, state revenues were estimated at 46 billion roubles (474 million euros). The price-revenue-tax model in detail The table shows the complete scenario calculation for Russian fertilizer exports and the government revenue derived from them. It is based on the exports of 46 million tons forecast by RAPU. In addition, the calculation is carried out for a lower export volume of 30 million tons, because Russia could restrict exports in times of crisis or some of the deliveries could be discontinued for other reasons. According to the known export structure of 2024, 31.7% of the modelled exports consist of potash fertilizer, 23.1% of urea (urea, a nitrogen fertilizer) and 11.4% of phosphate fertilizer. The remaining 33.8% is accounted for by other fertilizers such as ammonium nitrate and compound fertilizers. The export revenues were calculated from a weighted price for the total mix of urea, potash and phosphate. For the class of other and mixed fertilizers, the model assumes the weighted average price of the first three classes.Russian state revenues from fertilizers include the extraction levies on potash and phosphate raw materials as well as the gas levy on natural gas for ammonia production (more on this below). The starting point for the scenario calculation is the Ministry of Finance's tax estimate for 2025 of 24.7 billion roubles in extraction taxes and 21.5 billion roubles in gas tax. The levies are not based on fertilizer exports, but on production. The scenario calculation assumes that their total volume and composition will be the same as in 2025. It consists of 44.2% nitrogen fertilizer, 27.5% potash fertilizer and 28.3% phosphorus and complex fertilizer. A rough estimate of the levies is possible, as their level is linked to the world market prices of urea, potash and phosphate The base scenario assumes that the annual average prices for the three fertilizer classes correspond to the level in January 2026. It should therefore form a lower limit for the expected export revenues and government revenue. The maximum shock scenario, on the other hand, represents an upper limit. It is based on the assumption that the annual average prices for all three fertilizer classes are at the level of the respective historical monthly highs, i.e. USD 925 per tonne for urea and USD 1202 for potash (both April 2022) and USD 450 for phosphate (October 2008 to March 2009). The current scenario assumes that the annual average prices correspond to the already increased level at the end of March 2026. For urea, the scenario uses the price from March 27, for potash and phosphate the known monthly values from February 2026 plus an estimated premium of 10% for potash and 20% for phosphate. The third scenario, the nitrogen shock, is based on the experience of spring 2022, when high gas prices led to a record increase in the price of urea. The urea price is set at the record-high monthly value from April 2022, while the slightly higher prices from the current scenario are used for potash and phosphate. The buyers of Russian fertilizer The most important buyer of Russian fertilizer is Brazil, which is also the world's largest importer of fertilizers. In 2025, Brazil imported 11.1 million tons of fertilizer from Russia, according to an analysis of national trade statistics by the Russian investment company Veles Capital. India was in second place with 5.5 million tons. According to RAPU, more than three quarters of Russian exports go to countries in the "friendly" BRICS group of states. This group also includes China, which purchased 4.9 million tons of fertilizer from Russia last year. The development of the two major customers in the West was different. While the USA increased its imports from Russia by 26.7% to 5.1 million tons, the EU reduced them by 5.1% to 4.7 million tons. EU: Tariffs instead of sanctions against Russian fertilizer Since 2022, Russia has redirected numerous flows of goods from West to East. There has been less movement in the most important destination countries for fertilizers. Brazil was already by far the largest customer in 2021, followed by the USA and China. According to Eurostat, imports into the EU in that pre-crisis year amounted to a total value of 1.79 billion euros, roughly the same as the previous year's value of 1.74 billion euros. The total volume of fertilizer imports from Russia fell from 5.37 to 4.8 million tonnes, which still corresponds to around a quarter of total EU imports of nitrogen fertilizer. However, the decline in imports from Russia has accelerated since mid-2025. At 1.53 million tons, imports in the second half of the year were 44% below the level of the same period in 2024. On 1 July, additional tariffs on Russian fertilizers came into force in the EU with the aim of reducing imports from Russia. The tariffs are to be gradually increased almost tenfold by 2028, which Veles Capital believes would amount to a de facto ban on imports of Russian fertilizer. In view of the importance of fertilizer for the global food supply, the EU has so far refrained from imposing direct sanctions on the Russian fertilizer industry. Measures have only been taken against individual producers and in particular their owners, while fertilizers are largely exempt from import duties in the USA. According to analyst Maxim Shaposhnikov, US companies are taking advantage of this by increasingly importing Russian fertilizers for the domestic market and exporting their own production to the EU. How the state earns money from fertilizer The Russian state siphons off the profits of fertilizer manufacturers primarily through profit tax and, since 2025, through increased taxation of raw materials and intermediate products. These include higher extraction levies (NDPI) on potash and phosphate raw materials as well as a newly introduced levy on natural gas for ammonia production, which is linked to export prices. For 2024 the Ministry of Finance expected revenues totaling 111 billion rubles (1.14 billion euros), of which 89 billion rubles (910 million euros) will come from export duties, which will no longer be levied from 2025. For 2025, it expects revenues totaling around 46 billion roubles (472 million euros). This figure is made up of production levies of 24.7 billion roubles (253 million euros) and the natural gas levy of 21.5 billion roubles (231 million euros), with a large proportion of state revenue likely to come from profit tax. The net profits of the largest fertilizer manufacturers presented further down in this analysis together amounted to around 400 to 500 billion roubles, the equivalent of 4.1 to 5.1 billion euros. This estimate is based on an extrapolation of data available for various periods in 2024 and 2025, as shown below. With a profit tax of 20% in 2024 and 25% in 2025, the tax contributions of the seven companies presented could theoretically have amounted to around 140 billion roubles (1.4 billion euros). By comparison, the state's revenues from oil and gas amounted to 8.48 trillion rubles (87 billion euros) in 2025. roubles (87 billion euros), in 2024 it was even 11.1 trillion roubles (114 billion euros). In addition, oil and gas companies will also have to pay profit tax. In 2024, the reported profits of the most important industry representatives amounted to almost 5.5 trillion roubles (59 billion euros) in 2024, roughly exceeding the profits of the major fertilizer producers by more than ten times. Fertilizer shares rise, doubts remain Investors also expect the Russian fertilizer industry to benefit from the crisis. The shares of the only two major producers listed on the Moscow Stock Exchange, PhosAgro and Acron, have risen by 8-9% since the beginning of the Iran war until March 17, stated the business newspaper Kommersant. The leading index of the Moscow Stock Exchange, IMOEX, also recorded gains during this period, making it one of the few indices worldwide to show a positive development. However, with an increase of just under 2%, it lagged well behind fertilizer stocks, although some observers predict that Russian manufacturers will only benefit to a limited extent from the sharp rise in fertilizer prices. As the Reuters news agency learned from industry insiders, production capacities are largely fully utilized and must initially cover domestic demand. However, prices on the domestic market have been capped by the state for years. The opening of new production facilities for export is not expected until 2027 at the earliest. In addition, the state is likely to skim off a large part of the additional revenue. In the past, it has used one-off excess profit taxes and export duties for this purpose. Analyst Maxim Shaposhnikov also warns against a strong expansion of production and exports, as Western countries could respond with tougher sanctions against Russian fertilizers. The largest Russian fertilizer producers The Russian fertilizer industry is concentrated on a few large producers. Unlike in the oil and gas industry, the market leaders are also privately owned. The industry association RAPU stated in fall 2024 that its 13 member companies at the time were responsible for almost 80% of total production. The largest player on the market is the Uralchem Group, which includes the three producers Uralchim, Uralkali and TogliattiAzot (TOAZ). The group estimates its total capacity at 25 million tonnes per year, with the eponymous nitrogen fertilizer producer Uralchim accounting for around 8 million tonnes, Uralkali for around 12 million tonnes and TOAZ for up to 5 million tonnes. Business figures are only available for individual companies.Uralkali is one of the world's largest producers of potash fertilizers. Only the Canadian company Nutrien is likely to be larger, as a report by the USGS suggests. In 2024 Uralkali's production reached a record volume of 12.9 million tons of potash fertilizer. More recent figures are not available. Sales increased by 10.5% to 463 billion rubles (4.75 billion euros) in 2025 as a whole, while net profit more than quintupled to 149.6 billion rubles (1.5 billion euros). The third company in the Uralchem Group, TOAZ, is one of the world's largest producers of ammonia, the key precursor for nitrogen fertilizers, with a capacity of 3.6 million tonnes per year. In 2024 TOAZ produced 1.9 million tonnes of ammonia, 21% more than in 2023, and 1.8 million tonnes of urea (+9%), which is a type of nitrogen fertilizer.EuroChem is likely to be the largest single Russian company in the fertilizer industry. In 2024, it produced around 13 million tonnes of fertilizers, including 6.2 million tonnes of nitrogen products, 3.5 million tonnes of potash fertilizers and 4 million tonnes of phosphate and complex fertilizers. These figures also include the sites abroad, which are located in Belgium, Brazil, Lithuania and Kazakhstan. In the last full annual report presented by EuroChem for 2023 the company put its turnover at 363 billion roubles (3.7 billion euros), with a net profit of 112 billion roubles (1.1 billion euros).PhosAgro is one of the world's largest producers of phosphate fertilizers. Its total production increased by 4.3% to 9.15 million tons in the first nine months of 2025. Phosphate fertilizers accounted for 7 million tonnes (+5.5%) and nitrogen fertilizers for 1.94 million tonnes (+1.9%). Turnover for three quarters amounted to 441.7 billion roubles (4.53 billion euros) with a net profit of 95.7 billion roubles (982 million euros). Compared to the same period last year, sales rose by 19.1% and net profit by 47.6%.Acron, a major manufacturer of complex fertilizers combining several plant nutrients, is number four on the Russian fertilizer market. The company produced a total of 7 million tonnes of fertilizers last year, 4.1% more than in 2024. Nitrogen fertilizers dominated the fertilizer classes with 4.55 million tonnes (+7.3%). Complex fertilizers accounted for 2.41 million tons (+0.4%). Turnover rose by 20% to RUB 237.6 billion (EUR 2.44 billion), net profit by 30% to RUB 36.7 billion (EUR 380 million).The Azot group of companies is the fifth largest Russian producer of nitrogen fertilizers, writes the rating agency Expert RA. The company itself estimates its total capacity in 2024 at just under 4.3 million tonnes of nitrogen fertilizer and 1.9 million tonnes of the raw material ammonia. The company puts total production in 2024 at 4.2 million tons of fertilizer. According to financial portals, GK Azot's turnover in 2024 amounted to 115.2 billion roubles (1.2 billion euros), with a profit of 7.7 billion roubles (79 million euros).The chemical company KuibyshevAzot is one of the few other major fertilizer producers. The company states its production volume in the first half of 2025 at around 0.55 million tonnes of ammonia (-1.6%) and 1.04 million tonnes of nitrogen fertilizer (+7.4%). Fertilizers accounted for slightly more than half of the business. Sales for six months remained at 44.1 billion roubles (450 million euros) almost at the level of the same period last year (+1%), while net profit increased by 48% to 3.46 billion roubles (40 million euros). Sales of ammonia and nitrogen fertilizers alone amounted to 25.6 billion roubles (263 million euros). This article first appeared in the exclusive newsletter of the German-Russian Chamber of Commerce Abroad The post Russian fertilizer industry: world export champion and crisis profiteer appeared first on ostwirtschaft.de.