World's Top Urea Exporter Fertiglobe Resorts to Trucks to Bypass Strait of Hormuz

Fertiglobe, the largest seaborne exporter of urea and ammonia in the world, has shifted to trucking its fertiliser products from its Ruwais complex in Abu Dhabi to ports located outside the Strait of Hormuz. The company, majority owned by Abu Dhabi National Oil Company (Adnoc) with an 86 percent stake, normally loads its commodities onto ships in Abu Dhabi before they cross the strait. With that waterway effectively closed since the start of the US-Iran war on 28 February 2026, the producer has been forced to adopt alternative logistics arrangements to maintain its global flows.

Chief executive Ahmed El Hoshy described the new movements as abnormal compared with standard operations. Vessels have been redirected from Algeria and Nigeria to Australia, while Gulf cargoes are now trucked to UAE ports outside the strait such as Fujairah before being loaded onto ships. These overland shipments require many more logistical movements than usual, which raises costs significantly.

The company has been able to absorb the additional logistics expenses thanks to a sharp surge in fertiliser prices. Urea, the most widely used nitrogen fertiliser, climbed from about 465 dollars a tonne on 27 February 2026 to nearly 695 dollars by mid-April, peaking above 720 dollars a tonne on 15 April. On the Indian market, Fertiglobe's products jumped from around 500 dollars to more than 900 dollars per tonne over six weeks, reflecting the tight supply conditions caused by the Gulf disruption.

Fertiglobe operates 6.6 million tonnes per year of urea and ammonia capacity through subsidiaries in the UAE, Egypt and Algeria. The Ruwais facility is the company's main UAE hub and one of the largest urea production sites in the region. The plant remains operational, although surrounding infrastructure has been under sustained pressure since the conflict began. A drone strike caused a fire at the Ruwais refinery complex in March 2026, and Adnoc suspended operations at the Shah ultra-sour gas plant after a separate Iranian drone attack, cutting off granulated sulphur supplies normally transported by Etihad Rail to Ruwais Terminal for export.

The Strait of Hormuz historically carries about 30 to 35 percent of global nitrogen based fertiliser exports and roughly half of all urea shipments. The waterway has been effectively shut to commercial traffic since early March 2026 because of war-risk insurance withdrawal, missile and drone attacks on shipping, and Iranian controls imposed at Larak Island. Although a ceasefire was announced on 7 April 2026, the strait has not returned to normal operation. Iran continues to require vessels to obtain permits from the Islamic Revolutionary Guard Corps and to pay transit fees that some operators describe as a one dollar per barrel toll. Adnoc chief executive Sultan al Jaber stated publicly in early April that the strait remains closed despite the official ceasefire.

For Fertiglobe, the workaround relies heavily on Fujairah and Khor Fakkan, the two main UAE ports located on the Gulf of Oman side of the country. Customs procedures have been simplified to allow direct road transport of containers from these ports, easing the logistical strain on operators. Trucking the full 6.6 million tonnes of annual capacity is not realistic, so the company is also reallocating production from its Egyptian and Algerian assets to cover orders that would normally be sourced from Ruwais. Storage at the Ruwais facility has not been a constraint so far, according to the chief executive.

The shift has global implications for agriculture. India relies on Gulf producers for more than 40 percent of its urea imports and has been monitoring its stockpiles closely. Australia depends on the UAE, Qatar and Saudi Arabia for more than half of its urea supply and is among the markets most exposed to the rerouting. The United States, where prices for urea arriving via New Orleans jumped 17 percent in the first weeks of the conflict, also imports significant volumes from Gulf suppliers. The current planting season in several Northern Hemisphere markets has amplified the urgency of maintaining flows.

Mr El Hoshy stated that he expects the company to be able to normalise export flows relatively quickly once Gulf shipping resumes, but cautioned against assuming a rapid return to pre-war pricing. He pointed to a backlog of vessels waiting to move out of the strait, plant shutdowns at several Gulf producers, and slow restart timelines as factors that will keep prices elevated for some time.

The trucking solution is unprecedented in scale for the regional fertiliser industry. Maritime exports through the Strait of Hormuz are the standard route for Gulf urea and ammonia producers, and overland transport to alternative ports has historically been viewed as economically unviable for bulk commodities. The current price environment has temporarily inverted that calculation, but the long term sustainability of the model depends on the duration of the strait closure and on whether maritime insurance markets restore normal coverage for Gulf transit.