Jun 20, 2022

USDA extends fertilizer cost, supply comment period

The U.S. Department of Agriculture is again extending the deadline for comments and information from the public about its “Access to Fertilizer: Competition and Supply Chain Concerns.”

The notice originally published in the Federal Register on March 17. The new deadline for comments is July 15,  and the previous deadlines for comments were May 16 and June 15, 2022.

“We are extending the deadline for comments an additional month to enable commenters to provide additional feedback regarding the role of capacity expansion and related strategies to directly enhance competition in the fertilizer market,” Andy Green, USDA’s senior advisor for fair and competitive markets, said in a news release. “USDA is committed to using every tool at its disposal to enhance competition and improve resiliency in the fertilizer market.”

In the Federal Register notice, USDA continues seeking input on:

• What obstacles exist to the financing and development of new fertilizer capacity that would enhance the competitiveness of fertilizer markets?
• Would new or expanded domestic manufacturing, mining, processing, or alternative fertilizer production capacity help promote access to and affordability of fertilizer for agricultural producers?
• Are there existing “shovel ready” manufacturing, mining, or other processes that could or should be adjusted to facilitate new fertilizer production?
• Are there other potential new entrants in the near or medium-term?
• How might USDA best support investment in new fertilizer capacity in the U.S.?

All written comments in response to the notice should be posted online at Access to Fertilizer: Competition and Supply Chain Concerns. Comments received will be posted without change, including any personal information provided. All comments should reference the docket number AMS-AMS-22-0027, the date of submission, and the page number of this issue of the Federal Register. Comments may also be sent to Jaina Nian, Agricultural Marketing Service-USDA, Room 2055-S, STOP 0201, 1400 Independence Avenue SW, Washington, D.C. 20250-0201. Comments will be made available for public inspection at the above address during regular business hours or via the internet at www.regulations.gov. The new deadline for comments is July 15.

Background on giving farmers more fertilizer choices

On March 11, 2022, USDA announced plans for a $250 million investment in grants to support additional fertilizer production for American farmers to address rising costs and spur competition. On May 11, in conjunction with his visit to an Illinois farm, USDA Secretary Tom Vilsack announced a doubling of the initial grant investment to $500 million, among other measures designed to assist farmers.

Fertilizer prices have more than doubled since last year due to many factors, including a limited supply of minerals and high energy costs, high global demand and agricultural commodity prices, reliance on fertilizer imports and a lack of competition in the fertilizer industry. The top producers of the major components of fertilizer include China, Russia, Canada and Morocco, with Belarus also providing a significant share of potash.  The U. S. is a major importer and dependent on foreign fertilizer and is either the second or third top importer for each of the three major components of fertilizer.

The USDA will use funds from the Commodity Credit Corporation set aside for market disruptions in September 2021 to develop a grant program that provides “gap” financing to bring independent domestic fertilizer production capacity on-line.

The new $500 million grant program will support fertilizer production that is:

• Independent – outside the dominant fertilizer suppliers, increasing competition in a concentrated market;
• Made in America – produced in the U. S., benefitting domestic companies and domestic production and reducing the reliance on potentially unstable or inconsistent foreign supplies
• Innovative – takes the opportunity to make improvements in conventional fertilizer production methods to jump start the next generation of fertilizers
• Sustainable – uses renewable energy sources or feedstocks and a smaller environmental footprint
• Farmer-focused – like other CCC investments, the driving factor will be providing support and opportunities for U.S. agriculture commodity producers

Details on the application process will be announced this summer, with the first awards expected before the end of 2022.