It's good news for farmers, but a painful blow for fertiliser resellers who were encouraged to lock in supply at the height of the market and paid top dollar for large orders.
Advanced Ag general manager Andrew Mann said better access to product and government subsidies had helped the market level out, a welcome development for farmers after months of tight supply.
But the picture is very different further up the supply chain.
Australian Fertiliser Services Association chairman Heath Boseley said the Federal Government had underwritten only three major resellers, leaving other businesses and smaller "mum-and-dad" operators to absorb the losses on their own.
During the early stages of the conflict, Mr Boseley said, the government was telling resellers to lock up tonnage and sign contracts even at high prices, in order to avoid farmers going without.
"Suppliers and resellers obliged, purchasing large volumes at higher prices," Mr Boseley said.
Weeks later, prices began to fall.
Resellers who had signed contracts at the top of the price peak are now left holding expensive stock they cannot move, especially as underwritten competitors are able to sell at lower, government-supported prices.
Under the scheme, the government pays a "gap payment" covering the difference between the conflict-peak price and the current market rate, but only for the three companies covered by the arrangement.
Mr Boseley described the arrangement as a "favourite son deal".
"Small sellers stand to lose hundreds of dollars a tonne, across thousands or tens-of-thousands of tonnes of urea," he said, describing the situation for smaller operators as "really hurting" and now "about survival".
The three underwritten companies are Incitec Pivot, CSBP and Summit Fertilizers.
The AFSA argues a farm-gate rebate, paid directly to farmers rather than underwriting select importers, would have made more sense, been more equitable and been easier to implement.
The inequity has drawn criticism beyond the industry itself.
Shadow agriculture minister Darren Chester warned in May that underwriting only a handful of importers would distort competition, a prediction he says has now been borne out.
"The sharp fall in urea prices has exposed that flaw, with excluded resellers now facing significant losses while government-backed companies have been shielded from much of the risk," Mr Chester said.
"The government should have secured supply without undermining competition."
Mr Chester said he had raised the issue directly with the office of Agriculture Minister Julie Collins, but the fundamental question remained unanswered.
"The government has failed to explain why some businesses received taxpayer-backed protection while others were left to carry the full commercial risk," he said.
"Any future support must secure supply, preserve competition and treat all participants fairly."
He said the government should learn from the scheme's mistakes.
"If further intervention is needed while instability in the Middle East continues, it must be transparent, competitive and open to all eligible importers, not just a select few," Mr Chester said.
A spokesperson for the Federal Government said the subsidies were part of the Fuel and Fertiliser Security Facility, established to respond to disruptions to global fertiliser supply chains caused by the Middle East conflict.
"Participants were prioritised against a national interest test to meet the objectives of the facility, with the same criteria applied to all suppliers," the spokesperson said.
The spokesperson said more than 86 per cent of the urea imported into Australia for the season had been secured through usual commercial channels, and that underwriting additional fertiliser shipments to secure critical supply had been called for by industry, including Fertilizer Australia, and welcomed by the National Farmers Federation.
The spokesperson said that Export Finance Australia executed the master agreements with the companies and that the decision did not rest with the Minister for Agriculture, Fisheries and Forestry.
Participation had focused on importers being able to secure and distribute material volumes quickly at scale, so product reached farmers when and where it was needed.
The spokesperson said participants were required to comply with any ACCC obligations.
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