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IATP research shows fertilizer industry benefitting from crises in multiple ways

The director of climate change and rural strategies with the Institute for Agriculture & Trade Policy says the fertilizer industry is once again utilizing global crises to its benefit.

During a recent webinar, Ben Lilliston says an analysis of industry profits during the last major price spike at the start of the war in Ukraine is revealing.

“The nine biggest fertilizer companies made a 36% profit.”  He says, “We don’t have those kinds of financial numbers for this one yet, but their first quarter and second quarter financial reporting indicates that they’re doing quite well.”

He says fertilizer lobbyists have also used the current global situation to advance key policy changes, including more government subsidies and reduced regulations.

“The Trump administration waived tariffs for phosphorus fertilizer, so that lowers basically the industry’s costs.”  He says, “In the U.S., we have something called the Jones Act, which restricts shipping. The Trump administration waived that, so this also lowers the cost.”

Despite some talk of a crackdown on consolidation within the industry, Lilliston says…

“There’s supposedly a Federal Trade Commission investigation and a Justice Department investigation, but they actually haven’t taken any action.”

Instead, he says the industry continues to consolidate, and the latest forecasts call for farmers to continue to see elevated fertilizer prices through at least 2028.