JEFFERSON CITY, Mo. — Rising inputs are weighing heavily on everyone’s minds, with reports of double, if not triple, the costs. Facing the issue head-on, the Missouri Corn Growers Association (MCGA) is avidly working to raise awareness while looking for long-term solutions.
Supply chain issues, labor shortages, rising natural gas costs, inflation, geopolitical sanctions, and countervailing duties have contributed to high prices. However, one point can’t be ignored: the small number of companies completely dominating the domestic market. For example, Mosaic petitioned the Commerce Department and the U.S. International Trade Commission to place tariffs on phosphates from Russia and Morocco at around 19%. This effectively secured over 80% of the domestic phosphorus market for Mosaic. While phosphorus prices have doubled since last fall, Mosaic’s gross margins have increased 143%.
In addition, CF Industries, the company that controls an estimated 55% of the domestic nitrogen market, is following Mosaic’s lead and petitioning for countervailing duties to be placed on nitrates from Russia, and Trinidad and Tobago. Restricting supply even further to maximize profit could have serious repercussions. MCGA is fighting back.
While there is no silver bullet, there is a glimmer of good news. In August, the administration enacted sanctions against Belarus, the world’s third-largest producer of agricultural potash. While the reasons for these sanctions were justified, the unfortunate reality is domestic potash prices rose 13% in the month after the sanctions were put in place, 56% higher year-over-year. While the European Union and United Kingdom imposed similar sanctions, they built in an agricultural exemption for potash, putting European farmers at a competitive advantage over U.S. producers.
To help even the playing field, MCGA recently worked with Congresswoman Vicky Hartzler to present the farmers’ case to the U.S. Department of Treasury. Within weeks, the Treasury agreed to provide a reprieve through April 2022 for potash fertilizers imported from Belarus. We appreciate Cong. Hartzler’s willingness to go to bat for corn farmers. MCGA remains dedicated to finding long-term solutions on the bigger issue of inputs.
— Missouri Corn Growers Association