Middle East unrest rattles Brazil grain farmers

Tensions in the Middle East, home to large food importers and strategic fertilizer suppliers like Iran, have rattled grain farmers and traders in Brazil as a massive corn crop hits the market and the 2025/26 soy crop is prepared.

Frederico Humberg, founder of grain trader AgriBrasil, estimates Middle East tensions could impose losses of 5 billion reais ($909.84 million) on Brazilian grain producers, based on higher prices of inputs like urea, a key corn nutrient which at one point rose by $100 per metric ton. Exporters are also grappling with a 20% rise in maritime freight costs, or $7 per metric ton on some routes, amid continued market volatility, he said.

“We still have 80 million tons to ship,” Humberg said, referring to both corn and soy.

Iran accounts for 17%-20% of Brazil’s urea fertilizer demand while it bought some 12% of Brazil’s corn exports of nearly 38 million tons in 2024.

Brazilian farmers, who are currently harvesting a huge second corn crop, could export 44 million tons of it this season, said consultancy Agroconsult this week. But this year, expected abundant supplies from the U.S., Argentina and Ukraine mean stiff competition for Brazilian growers.

Mauricio Buffon, a farmer in Tocantins state, sees a challenging outlook.

“I have a lot of corn to sell. Unfortunately… a market of 4.5 million tons was closed, which is significant,” he told Reuters, referring to Iran, adding mainly domestic buyers are purchasing corn at this time.

By now, Buffon would have ordered at least part of the crop nutrients needed for his 2026 second corn crop. But higher prices and volatility kept him out of the market, he said.

Complicating matters, Chinese buyers have withdrawn from corn markets in addition to Iran, Agroconsult said this week. Humberg said China, a large corn producer, is an opportunistic buyer which only imports the cereal when its own output is insufficient.

Endrigo Dalcin, a Mato Grosso farmer, described “stagnated” farmer input sales in Brazil’s interior amid Middle East tensions.

He has yet to buy seeds, chemicals and fertilizers ahead of planting his new soy crop come September.

“Silos are full and pockets empty,” he said. Dalcin also mentioned an unfavorable exchange rate as reducing the prospect of farmer gains from the sale of corn on export markets.

Marcos da Rosa, another Mato Grosso farmer, said one input supplier delayed delivery of a portion of the phosphate fertilizer he had ordered, without giving a reason. He said the seller “offered money back” but he refused because that cash would not suffice to buy the same quantity of fertilizer now.

“War broke out, raising costs and the risk of losing an importer,” he said, referring to Iran.

Tags: corn, Brazil, fertilizers, Iran