Three Fertilizer Plays That Could Shape Your 2026 Portfolio Strategy

The Big Picture: Why Fertilizer Matters Right Now

After taking a beating in 2024 when oversupply and weak demand sent prices into freefall, the fertilizer sector staged a notable comeback in 2025. Yet the industry’s recovery tells a nuanced story—one of opportunity mixed with headwinds that investors need to understand before committing capital.

The core issue remains straightforward: farmers are caught between higher fertilizer costs and lower crop prices. While U.S. net farm income is expected to climb 40.7% year-over-year to $179.8 billion in 2025, this figure masks a troubling reality. Crop cash receipts are projected to decline 2.5% due to oversupply of corn, soybean and wheat, keeping commodity prices depressed compared to 2022 peaks. When fertilizer prices rise but grain prices fall, growers face margin squeeze that often leads to reduced application rates and softer demand ahead.

What’s Driving Fertilizer Prices in 2025?

Three factors are creating a more balanced supply-demand dynamic. First, China’s export restrictions and U.S. tariffs have tightened global supply. Second, solid agricultural fundamentals in major growing regions continue to support nutrient demand. Third—and this is critical—raw material costs remain elevated. Sulfur and ammonia prices, essential inputs for phosphate production, remain high due to Russia-Ukraine supply disruptions and plant maintenance shutdowns. Natural gas prices, which feed nitrogen fertilizer production, add another cost layer. These pressures mean fertilizer producers are seeing margin recovery on higher selling prices, but their profit expansion is partially offset by elevated input costs.

Three Stocks Worth Watching

Nutrien Ltd. (NTR) brings scale and diversification to the table. The Canadian company is benefiting from strong North American demand, strategic acquisitions in Brazil, and aggressive cost-cutting in its potash operations. Management is actively reducing controllable costs to bolster free cash flow. The investment community is bullish—earnings estimates for 2025 have been revised upward 1.5% over the past two months, and the company is projected to deliver 32.6% earnings growth this year. NTR carries a Zacks Rank #3 (Hold).

Yara International ASA (YARIY), based in Norway, holds a distinct advantage: industry-leading expertise in ammonia production and distribution. As nitrogen fundamentals remain supportive, YARIY’s business model is well-positioned to capitalize. The stock has posted a trailing four-quarter earnings surprise averaging 58.4%, suggesting management consistently beats expectations. For 2025, consensus earnings estimates have ticked up 0.9% recently, with projected earnings growth of 150.6%—a dramatic figure reflecting depressed prior-year comparisons. YARIY also maintains a Zacks Rank #3.

Intrepid Potash, Inc. (IPI) is the U.S.'s sole domestic producer of muriate of potash, giving it natural supply protection. The company also manufactures Trio, a specialty fertilizer benefiting from economic recovery and healthy farmer economics. With capital projects underway to boost production and favorable demand conditions, IPI is positioned for upside. Remarkably, the company is projected to deliver 506.7% earnings growth for 2025, and recent estimate revisions have moved 3.4% higher. IPI also carries a Zacks Rank #3.

The Balancing Act Ahead

The fertilizer sector’s 2026 outlook hinges on whether the positive fundamentals—increased corn and soybean acreage expectations, sustained global food demand, and improving farmer economics—can outweigh cost pressures. Phosphate and potash prices have recovered well, but sulfur and other raw material costs remain sticky. If farmer profitability continues to improve and input prices stabilize, these three companies could deliver meaningful returns. Conversely, if crop prices remain depressed and fertilizer costs don’t moderate, application rates could fall sharply, damaging demand prospects.

For investors seeking exposure to agriculture’s essential inputs, these three fertilizer stocks merit consideration as part of a diversified strategy heading into the new year.