The United States Department of Agriculture (USDA) has announced that it will support the production of additional fertilizers for American farmers to meet rising costs, including the impact of Putin’s price hike on farmers, and to stimulate competition. The USDA will make $250 million available through a new grant program this summer to support independent, innovative, and sustainable U.S. fertilizer production to supply U.S. farmers.

To address growing concerns about competition in the agricultural supply chain, the USDA will launch a public survey seeking information on seeds and agricultural inputs, fertilizers, and retail markets.

“Recent supply chain disruptions, from the global pandemic to Putin’s unprovoked war on Ukraine, have shown how important it is to invest in this crucial link in the agricultural supply chain here. home,” said US Secretary of Agriculture Tom Vilsack. “As the President said [at the State of the Union]we are working to rebuild the economy towards resilience, security and sustainability, and this support to provide national, sustainable and independent choices for fertilizer supply is part of that effort.

Fertilizer prices have more than doubled since last year due to many factors including Putin’s price hike, limited supply of relevant minerals and high energy costs, high global demand and prices for agricultural products, dependence on fertilizer imports and lack of competition in the fertilizer sector. industry.

The United States is a major importer and dependent on foreign fertilizers and is the second or third largest importer for each of the three major fertilizer components. The main producers of the main fertilizer components are China, Russia, Canada and Morocco, with Belarus also providing a significant share of potash/

The USDA will use Commodity Credit Corporation (CCC) funds set aside in September for market disruptions to develop a grant program that provides “gap” financing to bring new domestic generation capacity online independent, similar to the recently announced meat and poultry. subsidies designed to promote competition and resilience in this sector.

The new program will support the production of fertilizer that is:

  • Independent – apart from the dominant fertilizer suppliers, increased competition in a concentrated market;
  • Made in America – produced in the United States by domestic companies, creating well-paying jobs at home and reducing dependence on potentially unstable or inconsistent foreign supplies;
  • Innovative –improving fertilizer production methods to relaunch the next generation of fertilizers;
  • Sustainable – reduces the greenhouse gas impact of transport, production and use through renewable energy sources, raw materials, formulations and encourages greater precision in the use of fertilizers ;
  • Farmer centered – like other Commodity Credit Corporation investments, a key driver will be to provide support and opportunity for US agricultural commodity producers.

Details of the application process will be announced this summer and the first prizes are expected to be distributed before the end of 2022.

“Concentrated market structures and potentially anti-competitive practices leave American farmers, businesses, and consumers facing higher costs, less choice and less control over where to buy and sell, and reduced innovation. , which ultimately makes it harder for those who grow our food to survive,” Vilsack mentioned. “As I speak to farmers, ranchers and agriculture and food businesses about recent market challenges, I hear significant concerns about whether large companies in the supply chain are taking advantage of the situation by increasing their profits – not just by meeting supply and demand or passing along costs.

The USDA will seek information specifically on:

  • fertilizer
  • seeds and agricultural inputs, especially with regard to the intellectual property system.
  • retail, including access to retail through wholesale and distribution markets.

The comment period will be open for 60 days after the RFIs are posted in the Federal Register, after which time comments may be submitted to regulations.gov. In the meantime, inquiries will be available on ams.usda.gov/about-ams/fair-competitive/rfi.

The USDA will use the feedback received to develop EO-mandated reports on competition and to develop policies related to fair and competitive markets, supply chain resilience, pandemic response, local and regional food systems and other areas. Subsequent actions can range from new grant and loan programs to additional rules and regulations under the Packers and Stockyards Act of 1921 and other relevant laws to increase fairness and competition in US agricultural markets.

More information about this RFI is available at ams.usda.gov/about-ams/fair-competitive.