The U.S. States International Trade Commission (USITC) on March 11 determined that the U.S. phosphate industry is materially injured by reason of imports of phosphate fertilizers from Morocco and Russia that the U.S. Department of Commerce (DOC) has determined are subsidized by the governments of those countries. The Mosaic Co., Tampa, filed the complaint on June 26, 2020 (GM June 26, 2020)
Chair Jason E. Kearns, Vice Chair Randolph J. Stayin, and Commissioners Rhonda K. Schmidtlein and Amy A. Karpel voted in the affirmative. Commissioner David S. Johanson voted in the negative.
As a result of ITC’s affirmative determinations, DOC will issue countervailing duty (CVD) orders on imports of phosphate fertilizers from Morocco and Russia that will remain in place for at least five years.
Based on DOC’s final decision in February (GM Feb. 12, p. 1), the cash deposit rates for such imports are expected to be 19.97 percent for Moroccan producer OCP, 9.19 percent and 47.05 percent for Russian producers PhosAgro and EuroChem, respectively, and 17.2 percent for all other Russian producers.
“Mosaic employees are proud to support American farmers by producing high quality, reliable fertilizer,” said Mosaic President and CEO Joc O’Rourke. “Today’s decision upholds our belief that fair trade is a cornerstone of a healthy U.S. economy, and that American farmers will benefit from having a more competitive American fertilizer industry.”
“This decision comes despite the arguments presented by the OCP Group demonstrating that there is no basis for such duties, as well as significant voices opposed to Mosaic’s petition from across American agriculture – distributors, associations, and cooperatives – and elected officials in the Senate and House of Representatives,” OCP said in a statement, noting that the full details on the decision are expected in April.
“Despite this decision, OCP recognizes the supply challenges that American farmers face and is determined to serve them in the future, and will explore the most appropriate options to do so,” OCP added.
Russia’s PhosAgro and EuroChem had not responded to inquiries at press time.
As for OCP’s indications that it wants to still serve the U.S. market, J.R. Simplot Co., Boise, in March 8 final comments, said that regardless of ITC’s decision, the respondents would certainly ship phosphates to the U.S.
“The only effect of affirmative determinations here would be to impose the countervailing duties calculated by the Department of Commerce to ensure that subject producers do not obtain an unfair advantage in this market due to government subsidies,” Simplot said. Simplot argued that the respondents did not want to sell at a fair price, but instead to have unconditional access to the market so they may continue to engage in unfair trade.
Koch Fertilizer, Wichita, Kan., in one of its later filings, said the U.S. is the only phosphate fertilizer market that produces what it needs, but then exports a lot of what it produces so that imports are needed to satisfy U.S. demand. Koch in particular detailed Mosaic’s price advantage and commitment to shipping product to Brazil.
“Having decided to export significant amounts of U.S. production, Mosaic cannot now attribute its actions to imports,” said Koch. “It has a strategy in which it intentionally abandoned U.S. customers and should not be surprised that these customers have turned to imports for the product they need.”
ITC’s public report Phosphate Fertilizers from Morocco and Russia (Inv. Nos. 701-TA-650-651 (Final), USITC Publication 5172, March 2021) will contain the views of the Commission and information developed during the investigations. The report will be available on April 13, 2021, and can be accessed on the USITC website at http://pubapps.usitc.gov/applications/publogs/qry_publication_loglist.asp.