WASHINGTON – U.S. Senator Tommy Tuberville (R-AL) joined Senator Jerry Moran (R-KS) and Senator Roger Marshall (R-KS) in calling on U.S. Department of Commerce (DOC) Secretary Gina Raimondo to revise how DOC calculates countervailing duties (CVD) on phosphate fertilizers from Morocco.
The U.S. Court of International Trade (CIT) recently remanded to the Department of Commerce a calculation of its subsidies, which impacts duties imposed on phosphate fertilizers. The bicameral group emphasized the financial burden these duties are placing on farmers.
“Our farmers are facing an increase of over twenty-eight percent in overall farm production costs and a sixty percent increase in fertilizer prices since Joe Biden took office,” said Senator Tuberville. “They cannot afford this. Our farmers rely on fertilizers to improve their crop yields. We need to take action to relieve the pressures of input taxes and unleash domestic energy production.”
“We ask that Commerce carefully consider and follow the CIT’s decision in Commerce’s recalculation of the subsidy amount, both in its final determination in the investigation and its administrative review,” the members wrote in the letter.“Reducing the subsidy rate would provide welcomed relief for U.S. farm suppliers and their customers, American family farms.”
The letter was also signed by Sens. John Boozman (R-Ark.), Ted Budd (R-N.C.), John Cornyn (R-Texas), Joni Ernst (R-Iowa), Deb Fischer (R-Neb.), Chuck Grassley (R-Iowa), Bill Hagerty (R-Tenn.), Cindy Hyde-Smith (R-Miss.), Pete Ricketts (R-Neb.), Thom Tillis (R-N.C.), Roger Wicker (R-Miss.), and Todd Young (R-Ind.) and Reps. Tracey Mann (R-Kan.), Jim Costa (D-Calif.), Mark Alford (R-Mo.), Jim Baird (R-Ind.), Mike Bost (R-Ill.), Sharice Davids (D-Kan.), Mike Flood (R-Neb.), Sam Graves (R-Mo.), Michael Guest (R-Miss.), Dusty Johnson (R-N.D.), Trent Kelly (R-Miss.), David Kustoff (R-Tenn.), Jake LaTurner (R-Kan.), Julia Letlow (R-La.), Mariannette Miller-Meeks (R-Iowa), Barry Moore (R-Ala.), Zach Nunn (R-Iowa), Jimmy Panetta (D-Calif.), Greg Pence (R-Ind.), John Rose (R-Tenn.), David Rouzer (R-N.C.), Adrian Smith (R-Neb.), Mike Ezell (R-Miss.) and Ann Wagner (R-Mo.).
The full letter can be found here and below.
Dear Secretary Raimondo,
We write concerning the countervailing duty (CVD) proceeding on Phosphate Fertilizers from Morocco and the recent remand of the Department of Commerce’s (Commerce) subsidy calculations in this proceeding (Mosaic Co. v. United States, Consol. Court No. 21-00116, Ct. Int’l Trade Sep. 14, 2023). As Commerce considers its response to the U.S. Court of International Trade (CIT), it is also finishing its first administrative review of the Order. We are encouraged by Commerce’s preliminary findings in its administrative review, reducing the subsidy rate from 19.97% to 14.49%. We ask that Commerce carefully consider and follow the CIT’s decision in Commerce’s recalculation of the subsidy amount, both in its final determination in the investigation and its administrative review. Reducing the subsidy rate would provide welcomed relief for U.S. farm suppliers and their customers, American family farms.
Commerce’s subsidy rate calculation has a significant effect on U.S. farmers. In 2023, the U.S. demand for phosphate fertilizer is estimated to be 7.4 million metric tons. As the petitioner in the underlying proceeding continues to export production, imports are required to supply 2.7 million metric tons of this amount. Since the imposition of CVD on Moroccan phosphate fertilizers in 2020, the supply options to meet U.S. farmers’ phosphate needs have significantly decreased. Saudi Arabia (where the petitioner has invested in production and which is not subject to any Order) has become the only major exporter of phosphate fertilizer to the U.S., accounting for 66% of diammonium phosphate (DAP) imports and 25% of monoammonium phosphate (MAP) imports.
This situation has contributed to the high volatility of fertilizer prices overall, increased costs of a critical nutrient, and exposed farmers to the risk of inadequate supply into the future, given the lack of sufficient domestic supply to meet U.S. farmers’ needs.
While many factors impact the regional and global prices for phosphate-based fertilizers, the impact of the CVD proceeding on Moroccan exports to the U.S. was felt immediately and continues to provide upward pricing pressure. Since the imposition of the duty, average prices in New Orleans, the central pricing hub for the U.S., have been the highest in the world. This year, U.S. DAP prices were 11% higher than Brazil’s and 8% higher than India’s. American farmers purchase this key input at elevated prices but sell their crops at global market prices where they compete with major producers such as Brazil. The current CVD Order on Moroccan exports and magnitude places U.S. farmers at a competitive disadvantage. We now understand from the CIT that significant errors in Commerce’s initial calculation exacerbated this disadvantage. Accordingly, we urge the Department of Commerce to carefully address the matters determined by the CIT to be in error in the remand determination and in the upcoming final results of the final administrative review.
American family farmers need a reliable, diverse supply of many agricultural inputs, including fertilizers. The administrative review and the response to the CIT remand present opportunities to address this situation and to properly consider the facts as to the amount of subsidies in this proceeding since its inception.
BACKGROUND:
As Alabama’s voice on the Senate Committee on Agriculture, Nutrition, and Forestry, Coach Tuberville is committed to supporting Alabama’s farmers and producers.
During recent Farm Bill listening sessions throughout Alabama, Coach heard the concerns of peanut, cotton, and soybean farmers who are struggling in Joe Biden’s economy.
Last month, Senator Tuberville introduced the Farmers’ Market Expansion Act to add tree nuts, including pecans, to USDA’s Seniors’ Farmers’ Market Nutrition Program. This would provide a new market for pecan producers and allow seniors increased access to nutritious, locally-sourced pecan products.
In July 2023, Senator Tuberville introduced two pieces of legislation—the Farm Board Act and the Mid-South Oilseed Double Cropping Study Act of 2023—to improve opportunities and representation for Alabama’s agriculture community.
The Farm Board Act, which Senator Tuberville introduced with Senator Raphael Warnock (D-GA), and Senator Peter Welch (D-VT) would make changes to the Federal Crop Insurance Corporation’s (FCIC) ten-member Board of Directors. The FCIC is a government-owned corporation that finances the federal crop insurance program’s (FCIP’s) operations. There are currently four seats for agricultural producers on the board, of which one must be a producer of specialty crops. This bill designates two of the remaining three open seats for farmers on the FCIC Board as (1) a producer of livestock and crops, and (2) an underserved producer, respectively.
The Mid-South Oilseed Double Cropping Study Act of 2023, led by Senator Tommy Tuberville (R-AL), Senator Katie Britt (R-AL), Senator Bill Hagerty (R-TN), and Marsha Blackburn (R-TN), would request a study from the USDA Risk Management Agency (RMA) on the gap in crop insurance coverage for certain winter oilseed crops, specifically canola and rapeseed, and double cropping policies. For farmers to take advantage of opportunities in renewable diesel and Sustainable Aviation Fuel, they need the assurance that crop insurance—such as Catastrophic Risk Protection, Yield Protection, Revenue Protection, or Revenue Protection with Harvest Price Exclusion—will be eligible in their counties for these crops and practices. To address crop insurance gaps that may exist, RMA and FCIC need analysis of winter oilseed crop and double-cropping production practices and opportunities.
These bills build on Senator Tuberville’s legislation to address issues facing our agriculture community such as the Foreign Adversary Risk Management (FARM) Act, which would establish safeguards against foreign purchases of American farmland. Alabama is one of the most susceptible states to foreign agriculture influence, with our state having the third-highest amount of foreign-owned land in the country.
The U.S. Senate added a key part of Senator Tuberville’s legislation to the national defense bill with an amendment that would block the purchases of U.S. farmland by China, Russia, North Korea, and Iran and add the Secretary of Agriculture to the Committee on Foreign Investment in the United States (CFIUS).
Senator Tuberville is also concerned with rising input costs continuing to cut into farmers’ bottom lines and making it difficult to do what they do best: farm. That’s why he helped introduce legislation to eliminate the federal Estate Tax, often called the Death Tax, to prevent any more family farms from going out of business due to this burdensome regulation. Instead of inhibiting production, the federal government needs to focus on creating an economic environment that preserves small businesses and family farms and incentivizes the next generation to enter the industry to continue feeding and fueling our nation.
Senator Tuberville also helped introduce the Feral Swine Eradication Act to extend and make permanent the pilot program established in the 2018 Farm Bill. The legislation would continue to safeguard public health, agriculture, and local ecosystems against the threat of feral swine. Feral swine impede farmers’ livelihoods and our national food supply, causing more than $1.5 billion in damages annually. Over the last five years, feral swine have impacted more than 173,000 acres in Alabama.
This year, Senator Tuberville was named the top Republican of the AG Subcommittee on Rural Development and Energy, which enables him to build on his work to expand broadband access for rural communities.
Senator Tuberville’s first hearing as Ranking Member of Rural Development and Energy—titled “Rural Broadband: Connecting our Communities to the Digital Economy”—focused on ways to expand broadband access in rural communities and incorporate these programs in the 2023 Farm Bill. Senator Tuberville invited Rainsville native and CEO of Farmers Telecommunications Cooperative Inc. (FTC), Frank Johnson, to testify before the subcommittee about successful broadband expansion technologies he’s seen through his work to increase service speeds for rural areas.
In addition to the Subcommittee on Rural Development and Energy, Senator Tuberville serves on the Subcommittee on Commodities, Risk Management, and Trade, and Subcommittee on Food and Nutrition, Specialty Crops, Organics, and Research.
Senator Tommy Tuberville represents Alabama in the United States Senate and is a member of the Senate Armed Services, Agriculture, Veterans’ Affairs, and HELP Committees.
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