In response to tackling the environmental consequences of fertiliser production, biofertilisers from organic sources are strongly promoted in line with circular economy and maximising resource use. Despite the outstanding potential of bio-based fertilisers for the sustainable development of the agricultural sector, an environmental investigation of these fertilisers is required to replace synthesised fertilisers. Considering the importance of iron as a plant micronutrient and the scientific gap in the environmental assessment of relevant fertilisers, iron-based fertilisers produced in EU and US geographical zones are selected as a case study in this paper. Therefore, this study examines the environmental performance of two iron-based fertilisers (Fe-biochelate and Fe-EDDHA) by the life cycle assessment (LCA) methodology. The LCA model has been implemented in Simapro software by the ecoinvent database and ReCipe 2016 method considering 1 kg iron content as a functional unit. The results revealed that the Fe-biochelate reduced impacts (69–82%) on all relevant categories, including global warming (69%), terrestrial ecotoxicity (82%), and fossil resource scarcity (77%) in comparison with Fe-EDDHA. Soymeal and acetic acid were the main stressors identified in Fe-biochelate production, while phenol, ethylenediamine and glyoxal were the most significant contributors to the impact categories related to Fe-EDDHA. As a result, Fe-biochelate can be considered a more eco-friendly alternative to Fe-EDDHA.