The Biden administration should give some immediate, short-term relief to farmers by eliminating tariffs on imported fertilizer from Morocco, three prominent agricultural groups say.
The American Farm Bureau Federation, American Soybean Association and National Corn Growers Association have renewed their long-running request in light of the administration’s June decision to temporarily exempt tariffs on solar panels from four countries in Southeast Asia.
The U.S. Department of Commerce has been investigating whether those imported solar panels were actually produced in China and are being exported from the other countries to circumvent tariffs. The threat of retroactively applied tariffs on those panels, threaten domestic solar projects.
The ag groups recently sent a letter to Biden asking the administration to lift the Moroccan tariffs on phosphate fertilizer that have been in place since last year, which they say have had a “significant negative financial impact” on farmers and ranchers. The African nation is a major producer and exporter of the fertilizer.
“We strongly encourage the White House to eliminate or reduce fertilizer tariffs,” the Monday letter said. “Doing so would make fertilizer more accessible and help American farmers combat global food insecurity.”
Brent Johnson, the President of the Iowa Farm Bureau Federation, met recently in Washington, D.C., with a presidential aide to press their case. “Tariffs are something that can be done with the stroke of a pen and have an immediate impact,” Johnson said. He was unsure how much of an impact such a move might have on fertilizer costs, but the tariff is 20%.
U.S. Senator Chuck Grassley says he has long opposed the tariff, which was requested by Mosaic Company, the largest domestic producer of phosphate fertilizer. The company claims fertilizers produced in Morocco and Russia are unfairly subsidized by their governments. “Mosaic has 82% of the market,” Grassley told Iowa Capital Dispatch. “Why do they need tariffs protecting them from competition with Morocco?”
The ag groups said the prices of six fertilizers peaked earlier this year at record highs, which has the potential to affect crop production in future years. They attributed the exorbitant costs to global factors, such as natural gas shortages, a reduction of Chinese exports and Russia’s invasion of Ukraine, which has also boosted grain prices.
“In the current year, we are looking to be decently profitable — this is going to turn out to be a good year,” Johnson predicted for Iowa farmers. “But farmers have not yet felt the full effects of the high prices — in part because they might have bought fertilizers before the prices peaked — and next year’s profits are difficult to predict,” he said. In the longer term, the Biden administration should help accelerate domestic fertilizer production, according to Johnson.
Editor’s Take:
At this juncture, anything that would lower input costs, especially for fertilizer - a major farm/ranch input - would help farmers/ranchers remain competitive and profitable. The ag groups are not seeking anything exorbitant or unreasonable. And, let’s face it, farmers/ranchers are the backbone of our food and fiber production in the U.S. Food production, in fact, is a major national security interest. Lowering tariffs, of course, will also help farmers/ranchers to have more funds to purchase or lease trucks from CAD members!
