by | Dec 7, 2023

Agricultural Community to the International Trade Commission: Tariffs on Moroccan Fertilizers Hampering Family Farms

Kentucky Corn Growers Association, along with the National Corn Growers Association and 56 other agriculture organizations, urged the U.S. International Trade Commission today to consider the impacts that tariffs on Moroccan shipments of fertilizers are having on family farms.

The concerns were expressed in a letter that comes after the ITC was ordered by the U.S. Court of International Trade to reconsider its determination of material injury in a decision issued earlier in September.

“Rising prices for fertilizer inputs have strained America’s farmers and ranchers and have impacted availability for this critical component of nutrient and yield management,” the letter said. “Without predictable options to source this product, farmers struggle to plan for the future.”

The signatories noted that issues surrounding the international supply chain further complicate farmers’ ability to source phosphate. The letter further explains that the ITC originally made some inferences on the ability to re-ship product that are not indicative of reality.

“Agriculture supply chains are intricate and complicated, and the premise that re-shipping product from an originally intended destination to respond to regional demand fluctuations is simply not correct,” the letter said. “Instead, reliance on this incorrect premise has led to high fertilizer costs that create volatility and compromise the ability of farmers to be successful.”

The issue leading to the letter stems from a decision by Commerce in 2020 that favored a petition by the U.S.-based Mosaic Company to impose duties on phosphate fertilizers imported from Morocco and Russia. Mosaic had claimed that unfairly subsidized foreign companies were flooding the U.S. market with fertilizers and selling the products at extremely low prices. Meanwhile, phosphate fertilizer prices for farmers were climbing to record highs.

Soon after the decision, KyCGA, NCGA, and other state commodity grower groups, including the Kentucky Soybean Association, launched an aggressive campaign that called on Commerce to reverse the decision and for Mosaic to withdraw its request for tariffs. Over the past three years, KyCGA and NCGA have led the charge to raise concerns by filing an amicus brief, sending letters to the White House and federal agencies, and informing Members of Congress about the impact.

In November, as part of an annual review, the U.S. Commerce Department decided to reduce tariffs on the fertilizers from 19.97% to 2.12%, but that decision was retroactive and largely academic as the Moroccan company producing the fertilizers has halted shipping of all but one of its products into the U.S.

Efforts to permanently reduce the duties will involve several steps and multiple agencies over the coming months. This month, Commerce will have another opportunity to make the lower duties permanent when it considers a remand on the issue from the U.S. Court of International Trade. Then, in January, the ITC is expected to make a ruling based on another remand ordered by the court. Mosaic can appeal each decision.

In the meantime, the recent letter shows that corn growers and their allies continue to sound the alarms by outlining the economic effects of the duties.

“Farmers are the lifeblood of our food supply, contributing to our economic strength and the resilience of rural communities,” the letter said. “When burdened with high input costs, farmers see ripple effects occurring in every facet of their operation. This inhibits their ability to increase market access on the global stage and satisfy both local and regional customers.”

READ THE LETTER

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