Hurt U.S. Farmers
Duties protecting a small number of U.S. fertilizer producers have cut off essential imports, causing supply shortages and soaring prices for farmers
Hurt U.S. Farmers
Duties protecting a small number of U.S. fertilizer producers have cut off essential imports, harming security and supply.
STAND WITH US FARMERS VIDEO
Access to Phosphate Fertilizer Supply: U.S. Farmers Need Friends
Dear American farmers,
The Russian invasion of Ukraine, and the resulting additional shocks to global fertilizer supply due to sanctions against Russia and the cutoff of Ukrainian exports, add even more urgency and complexity to the mounting problems facing U.S. farmers seeking affordable and reliable access to vital plant nutrients.
Even before the Russian assault on Ukraine, U.S. farmers had been cut off from several major sources of badly needed and irreplaceable phosphate fertilizers due to US tariffs on Chinese imports, and countervailing duties (CVDs) placed on Moroccan and Russian imports at the request of US fertilizer manufacturers. At the same time, the dominant U.S. manufacturer and plaintiff in the phosphate CVD case – Mosaic – continues to export nearly half its production to serve its Brazilian retail network and seasonal demand in India and elsewhere. Yet it is precisely because of the consolidation and shrinkage of U.S. production of phosphate fertilizers over the past few decades that imports increased in recent years – for reasons that are impossible to reverse in the short run and maybe even in the longer run due to declining U.S. reserves of phosphate ore. Those phosphate fertilizer imports weren’t pushed; they were pulled by growing U.S. demand for reliable and diverse supply – a demand that is even more acute now.
A growing number of decision-makers in Congress recognize this need for helping the beleaguered American farmer. Last year, a bipartisan, bicameral group of 86 legislators signed a letter to the U.S. International Trade Commission asking the chair to “reconsider the duties placed on phosphate fertilizer products imported from Morocco” citing “the conditions surrounding on-farm expenses in the United States have dramatically changed since the U.S. International Trade Commission’s (ITC) determinations in the countervailing duty investigation of phosphate fertilizers from Morocco.”
At the same time, a group of 19 U.S. Senators has asked the Biden Administration to “review all available options to lower the cost of fertilizer.”
Undoubtedly that should include boosting supply from a staunch ally like Morocco. However, a year later the duties are still in place.
Morocco is blessed with the world’s largest reserves of phosphate ore, the key input in phosphate fertilizer. It has gladly and reliably made that ore, and the world-leading, high-quality supply of phosphate fertilizers produced by the OCP Group of Morocco, available to customers – and indirectly then to farmers — around the world at fair and market-determined prices. American farmers have an urgent need for access to reliable, quality sources of phosphate fertilizer. They need that reliable supply to grow abundant crops that will keep U.S. agriculture a world leader and help feed the world. As the current global uncertainty around crop nutrition supplies makes clear, U.S. farmers, who are affected by events beyond their control and beyond their borders, need friends.
OCP North America
A Letter to American Farmers...
Dear American farmers,
As you plan for spring planting, and wrestle with the complex choices you must make at this time each year, we know that you are particularly concerned about having reliable, timely and affordable supplies of high-quality and appropriate inputs, including fertilizers. As you have certainly heard, serious supply constraints have sent fertilizer prices soaring, and in many cases it is difficult — if not impossible — to get the product you want.
We hope to help.
As the custodian of the world’s largest reserves of phosphate, and a leading global producer and supplier of phosphoric acid and a broad range of phosphate fertilizers, the OCP Group has been proud to serve American farmers for many years with reliable supplies of high-quality phosphate fertilizers from our home base in Morocco — which was, in 1777, the first country to publicly recognize the United States and remains today one of America’s proud free-trade partners.
A few years ago, we established OCP North America to work more closely with farmers and partners across the agricultural innovation space to help build the future of agriculture here in the United States and lay the groundwork for innovations that can spread across the globe. We were grateful for the positive response we received from the retailers, cooperatives and other partners who serve your needs, who welcomed another dependable, high-quality source of vital inputs and a long-term commitment from a key U.S. ally and partner.
As you may know, unfortunately, in the fall of 2020, we had to make the painful decision to suspend our sales in the American market because of a U.S. government decision to impose burdensome duties on phosphate fertilizer imports from Morocco and from Russia — two of the most important sources of phosphate fertilizer for American farmers. The duties were imposed at the request of Mosaic, the dominant U.S. producer of phosphate fertilizers, along with one much smaller producer. Chinese imports to the United States already had been blocked by other duties. The only other major long-term source of imports, Saudi Arabia, was not a target of the petition. Other smaller foreign producers have tried to pick up the slack, but they cannot meet the full need of the market, and you have witnessed the shortages and dramatic price hikes that have resulted. At the same time, Mosaic continues to export substantial portions of its own U.S. production. Reliable estimates are that in 2021 they exported almost half of their phosphate fertilizers to farmers elsewhere, even though their total output for that year was reduced by weather events and production problems. In 2020, estimates are that they exported a bit more than half. To make matters worse, after a dramatic concentration of the phosphate fertilizer industry over the last 20 years, only four domestic producers remain, and total domestic production has shrunk. Mosaic dominates, with 60% of U.S. production of phosphoric acid, the phosphorus component of fertilizers.
We are in the process of appealing the imposition of duties on phosphate fertilizer from Morocco, which we believe is based on incomplete and inaccurate information, faulty arguments, misapplication of the law and a misreading of the dynamics of fertilizer trade in the United States. As a result, we are hopeful that the court will require the Department of Commerce and U.S. International Trade Commission to reconsider their determinations and that the agencies ultimately will terminate the countervailing duties order. We also are grateful that, both in the first phase of this process and now at the appeals phase, those who represent American farmers — producer groups, retailers, Members of Congress and others — have strongly and publicly opposed these damaging and unjustified duties. In the end, those duties only hurt you, forcing you to use whatever is available — often from one supplier, and not necessarily the product you want, if you can get it at all.
U.S. farmers need reliable, diverse and timely sources of phosphate fertilizers. While the OCP Group is proud to continue serving farmers across the globe, including Canada and Mexico, we are deeply committed to American farmers, who are among the best in the world.
As this process moves forward over the next several months, we invite you to learn more about the process, the facts and your options to make your voice heard by visiting www.standwithUSfarmers.com.
We wish you a productive season, and we look forward to serving you again as soon as this matter gets resolved.
OCP North America