Phosphoric Acid Market Surge Drives Fertilizer Industry Growth: Nutrien, CF Industries and Intrepid Potash in Spotlight

The global fertilizer sector is experiencing a significant turnaround, driven by robust demand for essential crop nutrients including phosphoric acid and potash. According to recent market analysis, three industry leaders—Nutrien Ltd., CF Industries Holdings and Intrepid Potash—are positioning themselves to capitalize on this recovery. With phosphoric acid and phosphate markets rebounding after years of weakness, investors are closely monitoring these major players for growth opportunities.

Phosphate and Phosphoric Acid Demand Rebounds in Global Markets

The fertilizer industry has entered a new phase characterized by healthy demand fundamentals. Phosphoric acid, a critical component in phosphate fertilizers such as diammonium phosphate and monoammonium phosphate, is experiencing renewed market interest as agricultural economics improve globally. Farmers in major growing regions are increasing their nutrient purchases, supported by strong crop prices and favorable economics.

Global agriculture markets remain resilient, with sustained demand for grains driving consistent need for crop nutrients. Low inventory levels among producers and distributors have created favorable conditions for phosphoric acid and phosphate demand. In particular, North America, Brazil and India are seeing strong uptake, with farmers prioritizing nutrient applications to maximize yields in response to growing food consumption worldwide.

The phosphate market fundamentals have improved markedly from the previous two years. Beyond phosphoric acid products, potash and nitrogen fertilizers are also experiencing enhanced demand. Expectations of elevated corn and soybean plantings in 2026 suggest continued momentum in fertilizer consumption. This recovery reflects both improved farmer sentiment and the structural need for nutrient replenishment in agricultural soils.

Supply Constraints Elevate Phosphoric Acid and Raw Material Costs

A critical factor reshaping the fertilizer landscape is the price recovery of key raw materials used in phosphoric acid and phosphate production. After extended weakness during 2023-2024, fertilizer prices, including phosphoric acid-based products, surged in 2025 due to tightening supply and increased demand.

The production of phosphoric acid relies heavily on sulfur and ammonia as key feedstock materials, both of which have faced significant supply disruptions. International supply chain pressures, particularly related to geopolitical tensions in Eastern Europe, have reduced ammonia and sulfur availability, pushing input costs substantially higher. Natural gas prices, critical for nitrogen fertilizer production, have also climbed, further pressuring industry margins.

These elevated input costs present a near-term challenge for fertilizer manufacturers. While higher selling prices for phosphoric acid and other nutrients are offsetting some cost pressures, the margin compression from raw material expenses remains a key concern. Plant maintenance and production shutdowns have exacerbated supply tightness, creating a dynamic where phosphoric acid producers must balance higher input costs against market pricing opportunities.

Industry Valuation and Market Performance Overview

The Zacks Fertilizers industry carries a Zacks Industry Rank of #42, placing it in the top 17% of more than 250 industries tracked. This ranking reflects improving near-term prospects, as historical data shows the top-ranked industries outperform lower-ranked ones by a factor of more than 2 to 1.

From a valuation perspective, the fertilizer sector trades at an enterprise value-to-EBITDA ratio of 5.24X, substantially below the S&P 500’s 18.8X and the broader Basic Materials sector’s 16.51X. This discount reflects historical weakness but also suggests potential upside as earnings recover. Over the past five years, the industry’s EV/EBITDA multiple has ranged from 4.55X to 18.05X, with a median of 10.18X.

However, the industry has underperformed the broader market over the past year, gaining 7.5% compared to the S&P 500’s 14.9% advance. The Basic Materials sector itself rose 39%, indicating the fertilizer group lagged even its peer sector. This relative weakness may present a contrarian opportunity for value-focused investors.

Three Fertilizer Giants Position for Growth

Intrepid Potash stands out as the sole U.S. producer of muriate of potash and also manufactures Trio, a specialty fertilizer formulation. The company is benefiting from strong farmer economics and robust demand for potash products. Production volumes remain solid, with capital projects underway to enhance future output. Intrepid carries a Zacks Rank of #2 (Buy), with projected 2025 earnings growth of 506.7%. The consensus estimate for 2025 earnings has remained stable over the past 60 days.

Nutrien, Canada’s leading crop input provider, is gaining from elevated demand for phosphate, potash and nitrogen products across major markets, particularly North America. The company’s strategic acquisitions, operational efficiency improvements and digital platform adoption are driving competitive advantages. Nutrien continues expanding in Brazil through targeted acquisitions and is pursuing cost reduction initiatives in its potash operations. The company projects 32.9% earnings growth for 2025, with analyst estimates revised upward by 1.5% in the past 60 days. Nutrien maintains a Zacks Rank of #3 (Hold).

CF Industries, based in Illinois, leads globally in nitrogen and hydrogen product manufacturing for fertilizer and industrial applications. The company is capitalizing on robust nitrogen fertilizer demand in North America, Brazil and India, plus rising industrial uses in its home market. CF remains focused on shareholder value through strong cash generation and balance sheet optimization. With a Zacks Rank of #3, CF Industries projects 32.8% earnings growth for 2025 and has beaten Zacks consensus estimates in four consecutive quarters at an average of 15%.

Investment Considerations

The fertilizer sector’s recovery reflects structural improvements in agricultural supply and demand dynamics, particularly as phosphoric acid and phosphate supplies tighten. Investors examining this space should consider both the attractive valuations relative to historical norms and the execution risks associated with elevated input costs. The three highlighted companies—Nutrien, CF Industries and Intrepid Potash—each offer distinct exposure to this industry cycle recovery and remain key options for portfolio consideration.