Agricultural Groups Call for End to Countervailing Duties on Phosphate Fertilizers

Sixty-five state and national groups, including the National Corn Growers Association, sent a letter to Commerce Secretary Howard Lutnick today calling on him to end countervailing duties placed on phosphate fertilizers imported from Morocco to ease the pain felt by farmers as fertilizers prices reach new highs.

The announcement comes less than a week after Federal Trade Commission Chairman Andrew Ferguson announced a major, industry-wide investigation into the fertilizer industry's pricing practices and concentration.

"These costs land on an already fragile farm economy," the letter said. "Net farm income has fallen roughly 31 percent from its 2022 peak, fertilizer prices are up more than 150 percent since 2020, and Chapter 12 farm bankruptcies have surged to their highest levels in several years."

The letter also noted that farmers are in their fourth straight year of losses, and that countervailing duties only exacerbate their financial outlook and could mean the difference between sustaining family farms for generations to come or seeing legacies come to an end.

The countervailing duties, requested by the U.S.-based Mosaic Company and Simplot, have been in effect since March 2021. The letter noted that the duties not only hurt farmers, but they also do not accomplish their intended goals.

"[The duties] do not protect a vulnerable domestic industry from unfair competition," the letter said. "Rather, they further prop up two companies who already dominate the domestic market and will continue to dominate that market absent CVD protection."

An independent analysis by the Agricultural and Food Policy Center at Texas A&M University has estimated that the countervailing duties on Moroccan phosphate raised input costs for farmers of corn, soybeans, wheat, rice, sorghum and cotton by roughly $6.9 billion over the 2021 through 2025 growing seasons. At its full initial rate of 19.97 percent, the duty drove up the U.S. price of diammonium phosphate by an estimated 28.6 percent.

The letter also targeted Mosaic's practices.

"Far from safeguarding domestic supply, Mosaic continues to curtail its own production, even as supply tightened at home," the letter noted. "These duties fail to do more than drive up costs for farmers and risk our national food security by limiting the large majority of our annual phosphate needs to a single supplier that continues to curtail production - enhancing our risks to supply chain disruptions."

NCGA has established an input task force that is looking at the causes of price hikes for supplies and how they can be addressed.

Read the Letter