US Seeking Fertilizer from Venezuela, Morocco Amid Iran War

Reuters reported on Tuesday that “the Trump ​administration is seeking other sources of fertilizer ‌amid the ongoing Iran war’s shipping constraints, including from Venezuela and possibly Morocco, White House economic adviser Kevin Hassett said ​on Tuesday.”

“‘We’ve … established licenses for Venezuela to produce ​more fertilizer. We’ve had discussions with Morocco,’ ⁠he said on CNBC’s “Squawk Box” program, calling it ‘an ​insurance policy against disruption’ for U.S. farmers,” Reuters reported. “‘I’m not ​saying that we can eliminate what disruption there is so far, but we can minimize it,’ Hassett told ​CNBC in the interview.”

“Fertilizer supplies have shrunk as ​the U.S.-Israeli war against Iran cut off critical nitrogen fertilizer ‌supplies ⁠from the Gulf to the world’s farmers, sending prices spiking by more than one-third in recent weeks,” Reuters reported.

Bloomberg’s Skylar Woodhouse reported that “while Hassett cited Morocco as having the world’s largest reserve of potash, data compiled by industry experts show the North African nation to have the biggest phosphate rock reserves, while its potash endowment is relatively small compared with that of Canada or Russia. The US currently has duties in place on Moroccan phosphate, which are under review. Pleas from US farm groups to remove those fees ramped up after the war began.”

“The focus is getting supplies to American farmers, Hassett said,” according to Woodhouse’s reporting. “‘It’s almost planting season, and there’s a lot of fertilizer that usually goes down.'”

Ag Groups Seek Removal of Morocco Phosphate Duties

Politico’s Rachel Shin reported that “ag trade groups are urging U.S. fertilizer companies to ask the Trump administration to remove duties on phosphate imports from Morocco to cut fertilizer costs for farmers.”

“Some of the nation’s leading commodity industry groups wrote to executives from two leading domestic fertilizer companies, in a letter first obtained by POLITICO, asking them to renounce their previous support for levies imposed in 2020 on Moroccan phosphate fertilizers,” Shin reported. “The letter to The Mosaic Company President and CEO Bruce Bodine and J.R. Simplot President and CEO Garrett Lofto was signed by the National Corn Growers Association, the American Farm Bureau Federation, the American Soybean Association, the U.S. Rice Producers Association and USA Rice, as well as dozens of other commodity groups.”

“‘Fertilizer manufacturers like The Mosaic Company and J.R. Simplot can immediately help alleviate some suffering in the agricultural economy by renouncing their support for continued [countervailing duties],’ they wrote,” according to Shin’s reporting. “The Commerce Department imposed additional duties on phosphate fertilizers imported from Morocco and Russia in 2020 after Mosaic and J.R. Simplot filed a complaint about foreign competition.”

Some Farmers Struggling to Obtain Any Fertilizer

Successful Farming’s Mariah Squire reported at the end of last week that “just as they’re gearing up for planting season, U.S. farmers, already stretched by high input costs and low commodity prices, are watching the price of fertilizer go up.”

“The recent conflict in Iran, the following closure of the Strait of Hormuz, and the resulting impacts to global markets are hitting farmers particularly hard right now,” Squire reported. “The wholesale price of urea, the nitrogen fertilizer the U.S. imports the most of, had a high-low spread of $460–480 per short ton the week of Feb. 27, just before the conflict began. By the following week, that spread was $520–620.”

But the Associated Press’ Jack Dura reported that “it could be worse, as some farmers may not be able to obtain fertilizer at any price, said Zippy Duvall, president of the American Farm Bureau Federation. ‘We’re being told that many of our farmers that haven’t preordered their fertilizer and paid for it may not even obtain the fertilizer that they’re going to need during the season or for spring planting,’ Duvall said. ‘That’s why this situation is so serious.’”

“Harry Ott, a cotton, corn and peanut farmer who also leads the South Carolina farm bureau, said there isn’t enough fertilizer stockpiled in warehouses to meet demand in the coming months,” Dura reported. “‘It is a really dire situation that our farmers facing,’ Ott said.”