The U.S. Department of Commerce (DOC) on Feb. 9 announced its final determination that phosphate fertilizer imports from Morocco and Russia are unfairly subsidized. DOC calculated a subsidy rate of 19.97 percent for Moroccan producer OCP, up from the 16.88 percent rate assessed in December (GM Jan. 1, p. 1). DOC calculated rates of 9.19-47.05 percent for Russian producers, down from the earlier 20.94-72.5 percent (GM Nov. 27, 2020).
PhosAgro rates dropped to 9.19 percent from 20.94 percent. EuroChem went to 47.05 percent from 72.5 percent, while all other Russian producers/exporters are now at 17.2 percent, down from 32.92 percent.
The U.S. International Trade Commission (ITC), which has been conducting a concurrent investigation, is slated to release its decision on or about March 25, 2021. If the ITC’s ruling is affirmative, DOC will issue countervailing duty orders, effective April 1, 2021, which will remain in place for at least five years.
“Mosaic, the U.S phosphate industry, and all American manufacturers who believe in free and fair trade appreciate the importance of today’s ruling,” said Mosaic President and CEO Joc O’Rourke. “The Commerce Department’s hard work on this case brought us one step closer to ensuring American farmers can depend on high quality, competitive American fertilizer for decades to come.”
The lowering of PhosAgro’s CVD rate to 9 from 21 percent makes sales by the company to the U.S. more attractive, said VTB Capital analyst Elena Sakhnova in a note cited by Bloomberg. More Russian sales to the U.S. could ease recent shortages and prevent a further price surge. However, she noted that trade flows are unlikely to change materially until the ITC issues its decision in March.