The Agricultural Retailers Association (ARA) on Aug. 6 added its voice to the antidumping and countervailing duty (CVD) investigations launched by the U.S. Department of Commerce (DOC) into UAN imports from Russia and Trinidad and Tobago.
In two separate letters addressed to DOC Secretary Gina Raimondo, ARA President and CEO Daren Coppock expressed opposition to the CVD petition, while acknowledging that CF is an ARA member and that “manipulated markets for natural gas and other subsidies aid exporters in other countries.”
“ARA members and their farmer customers purchase UAN from both domestic and foreign manufacturers,” the letters state. “While ARA strongly supports the domestic fertilizer industry and policies that will make them more efficient and competitive globally, we also support reducing both domestic and international trade barriers. Our overriding priority is what will be best for farmers and the retailers who serve them. Limiting fertilizer supply options for America’s farmers and ranchers in today’s marketplace will without question increase prices to farmers and limit product availability.”
ARA noted that domestic UAN production is primarily in the center of the country, with much of the imported UAN used in markets on the U.S. West and East coasts. Coppock said approximately 75 percent of all UAN used in the coastal markets is presently imported.
“Therefore, the effect on farmers and retailers would be especially sharp on the U.S. East and West coasts,” Coppock said. “The threat of material injury occurring in this scenario is the prospect of losing access to 75 percent of current UAN supply in the coastal markets. That outcome would pose severe material injury to growers and retailers.”
ARA urged the DOC to instead consider abolishing the Jones Act requirements for domestic shipping between U.S. ports, which Coppock said would be a better remedy than imposing duties on imports.
“The original justification for the Jones Act was to support a U.S. merchant marine fleet that could be called upon in times of military need to transport materiel,” Coppock said. “This function has not been used in decades despite multiple deployments of U.S. military assets. Therefore, the fundamental justification of the Jones Act no longer exists.”
ARA also took aim at the U.S. rail industry, arguing that dramatically higher freight rates over the last 15 years have further hampered the domestic industry’s ability to supply UAN to coastal markets in a timely and cost-effective manner.
“High transportation costs due to noncompetitive rail service and Jones Act requirements for ocean shipping between U.S. ports serve to make the domestic industry less competitive in reaching these coastal markets,” Coppock said. “The single U.S.-flagged vessel owned by CF Industries cannot supply markets on both coasts in a timely manner.”
Coppock noted that ARA’s opposition to the current UAN petition mirrors its past positions in antidumping cases involving fertilizer imports. The trade association in 2004 and 2005, for example, urged the U.S. International Trade Commission to revoke antidumping duty orders on urea imports from Russia and Ukraine, citing domestic supply concerns and prohibitively high fertilizer prices (GM Dec. 9, 2005; Sept. 19, 2005).
“We write today to reiterate our support for unfettered global trade in these products and specifically in opposition to this CVD petition,” ARA said in the Aug. 6 letters. “Our policy position supporting fair and free trade of agricultural products is a top priority, set by our board of directors, and this includes foreign and domestic manufacturers alike. We ask that you deny the CVD petition.”