The Senate Agriculture Committee will hold a May 12 hearing on fertilizer supply and affordability issues facing U.S. farmers. It’s the latest effort by the government to address fertilizer issues exacerbated by the Iran conflict.
Those slated to testify include:
- Andy Green, Center Market Strategies principal and senior adviser
- Trent Kubic, South Dakota Corn Growers vice president
- Eddie Melton, Kentucky Farm Bureau Federation president
- Corey Rosenbusch, The Fertilizer Institute president and CEO
- Joshua Westling, J. Westling & Co. CEO
Fertilizer prices will likely continue to rise through next year, according to North Dakota State University’s Agricultural Trade Monitor report. The NDSU Center for Agricultural Policy and Trade Studies considered the potential impact of the war if the Strait of Hormuz were to open immediately, if hostilities resumed or if the current ceasefire holds with only a limited number of ships passing through.
Even if the strait were to open within days — an unlikely scenario — the fall prepay projected urea price would be about 35% higher than it was before hostilities began. If the current stalemate drags on, urea prices would likely rise to $784 per short ton, which would be 56% higher than prewar levels. DAP prices are also projected to rise by a similar level.
Efforts to mitigate fertilizer crisis
Since the Iran conflict began, the Trump administration has eased restrictions on imports from Venezuela. It has also suspended the Jones Act to ease transportation restrictions between U.S. ports. Despite these efforts, prices continue to rise as fears grow over global fertilizer availability later this year.In late April, Sen. Roger Marshall, R-Kan., introduced legislation that would eliminate countervailing duties on phosphate fertilizer imports from Morocco. This has also become a priority of the Trump administration despite calls from some fertilizer producers to renew them before the duties expire next year.
“Phosphate is a critical nutrient for crop production, and right now, farmers are paying prices that threaten their bottom line,” Marshall said Apri 28. “This bill removes duties that are driving up costs for farmers and puts money back in the hands of the people feeding this country.”
At a press conference, also on April 28, Agriculture Secretary Brooke Rollins announced the administration would invest heavily in efforts to increase domestic fertilizer production. If the attempts succeed, she said they could potentially expand production of nitrogen by 30%, phosphate by more than 200% and potash by 100%.
“This president remains resolute and convicted to do everything we possibly can to ensure that we are doing what we can to make sure that this doesn’t happen again with our fertilizer prices,” Rollins said.