Farmers confront rising cost of fertilizer and fuel as spring seeding

Spring seeding is underway, and as farmers spend long hours in the tractor planting crops, they’re facing hefty increases to the cost of diesel and fertilizer.

They’re also already concerned about the 2027 crop year, since many will be making large fuel and fertilizer purchases in the months ahead.

Fighting in the Middle East has sent commodity prices soaring. As the conflict stretches into its third month, nitrogen-fertilizer prices remain sky-high, while the cost of diesel fuel for tractors and other farm machinery continues to cut into the profits farmers hope to make on their summer crops.

Spring seeding is well underway for Leroy Newman, as he plants wheat, barley, peas and canola on more than 1,600 hectares near Blackie, Alberta, a short drive southeast of Calgary.

His family has grown crops on this land since 1904, and the fourth-generation farmer said they are coming off one of their best-ever years, thanks to near-perfect growing conditions in 2025.

But this spring is different. 

Along with the usual spring optimism, there is anxiety about the rising financial pressure as fertilizer, fuel and freight costs continue to climb.

“I can maybe put a little less fertilizer on this year,” said Newman. Instead, he’s looking elsewhere to control costs.

“We’re probably not buying as much machinery this year,” he said. “We’re just holding tight.”

A 2027 problem too

The concern is shifting beyond this year’s crop.

Many farmers bought their fertilizer before the price spike, which is why steep fertilizer costs could have a much larger impact on what crops are planted in 2027. In particular, Newman warns many farmers could be forced to seed fewer canola acres next year. 

Crops such as corn and canola require high amounts of nitrogen-based fertilizer, while farmers typically don’t use any when growing peas, lentils or fava beans.

Fuel and fertilizer expenses are a major concern, considering farmers were already expected to face slimmer profit margins this year after a bumper crop in 2025 created softer prices, said Craig Johnston, chief economist at Farm Credit Canada (FCC).

The Strait of Hormuz is a critical energy and commodity shipping choke point that has been squeezed by the conflict in the Middle East, including for about 30 per cent of nitrogren-based fertilizer, said Johnston.

“This is going to affect not just fertilizer prices right now, but also I think the conversations heading towards, ‘is this becoming a 2027 problem as well?'” he said.

Speculating on price

On a bright, sunny Tuesday morning, farmers arrived with empty semi-trucks at Stamp Seeds, one of the largest independent seed suppliers in Western Canada, based in Enchant, Alta., about 200 kilometres southeast of…