Corn and Fertilizer Prices Slump as Geopolitical Risks Fade and Trade Routes Reopen

Key Facts

1The Bloomberg Agriculture Spot Index has nearly reversed its gains from the US-Iran conflict as geopolitical risks ease.

2BofA Global Research trimmed its 2026 corn upside target to $5.50 per bushel from $6.00.

3Urea prices reverted to pre-war levels as Middle East supply fears subsided and the Strait of Hormuz reopened.

Agricultural commodities and fertilizer prices have retreated sharply as the geopolitical risk premium from previous US-Iran tensions evaporated. According to reports, the Bloomberg Agriculture Spot Index has reversed nearly all its recent gains, driven by the reopening of the Strait of Hormuz and subsiding supply fears from the Middle East. Consequently, BofA Global Research trimmed its 2026 corn upside target to $5.50 per bushel, down from its previous forecast of $6.00.

This downturn coincides with broader deflationary pressures in global markets, as Swiss Producer Price Index data showed a 0.4% contraction on June 15, 2026, per market data. Simultaneously, German wholesale prices fell by 0.6% month-on-month, reinforcing expectations of slowing input inflation for the agricultural sector. Improved US weather conditions and an aggressive washout of speculative long positions have further accelerated the selloff in grain markets.

Traders should monitor support levels for corn following the downward revision of price targets, while keeping a close eye on China's Industrial Production, which grew 4.5% (as of June 16, 2026) as a proxy for future demand. Upcoming energy data will also be critical for assessing shipping costs, especially after API reported a significant crude oil stock draw of 8.33 million barrels on June 16, 2026.