US Agriculture Secretary Tom Vilsack has warned global fertilizer suppliers not to unnecessarily inflate prices. He cautioned the international fertilizer trade against trying to profit from the trade chaos caused by the Russian invasion of Ukraine.
American farmers are already suffering from the current high fertilizer costs. Vilsack said that supply disruptions or price spikes abroad could lead to even higher prices. Russia is a major producer and exporter of urea ammonium nitrate (UAN), a widely used fertilizer that many American corn farmers rely on.
Vilsack made these remarks during the USDA's annual Agricultural Outlook Forum. He further stated that he wants to ensure fertilizer companies “do not use this situation as an excuse to do something that is not justified by supply and demand.”
Besides concerns about price inflation, there could also be effects on both grain and fertilizer trade. Russia’s invasion of Ukraine may have global economic and trade implications. Together, the two countries account for nearly a quarter of the world’s grain exports.
The cost of UAN from Russia has already risen for American farmers due to recently increased import tariffs by the US Department of Commerce. It recently determined that Russia (and Trinidad and Tobago) unfairly subsidize exports of UAN to the US.
This has paved the way for anti-dumping duties. The Biden administration also plans to impose sanctions in April on potassium chloride exports from two major state-owned companies in Belarus.