U.S. seeks backup fertilizer suppliers to reduce damage to American farmers facing soaring costs and shortages

Farmers apply fertilizers just before or during spring 
planting. (Photo by Brandon Griggs, Unsplash)

With many crop fertilizers and fertilizer materials trapped by Iran's stranglehold on the Strait of Hormuz, the Trump administration has sought out countries that can produce or supply backup fertilizers for American farmers facing soaring fertilizer costs as they ramp up for spring plantings, reports Skylar Woodhouse of Farm Progress. American farmers already face economic headwinds from slowed trade with China, high fertilizer and fuel prices, high labor costs, and farm worker shortages.

White House National Economic Council Director Kevin Hassett told reporters earlier this week that the Trump administration was looking for ways to minimize U.S. fertilizer shortages. "Hassett said the U.S. has 'established licenses for Venezuela to produce more fertilizer,' and has held discussions with Morocco," Woodhouse writes.

Reuters reported that roughly 30% of the world's nitrogen fertilizer supply would normally go through the Strait of Hormuz. Woodhouse reports, "One facility in Qatar had produced so much fertilizer that it supplied 'maybe about 20%' of the U.S. market, according to Hassett. The Iran conflict has mostly shut the key Strait of Hormuz passage for ships."

A March 13 letter from the American Soybean Association, the National Corn Growers Association, and other organizations asked fertilizer manufacturers Mosaic and Simplot to rescind their support for countervailing duties on phosphate fertilizer imports from Morocco and Russia, which contributed to spiking fertilizer costs even before the Iranian conflict.

As the war with Iran continues, farming fertilizer isn't the only pivotal import that relies on transport through the Middle East. Alexander Osipovich of The Wall Street Journal reports, "A protracted conflict with Iran could curtail exports of many inputs into the global supply chain. . . ranging from agriculture to chemicals and pharmaceuticals."

Osipovich includes a list from Barclays analysts on "some key non-energy products exported from nine Middle Eastern countries affected by the conflict." It's shared below.

62% of limestone flux, which is used in construction and is primarily sent to India
47% of sulfur, used for fertilizers and chemicals
28% of acyclic alcohols and derivatives, used as industrial chemicals and as fuel additives, and mostly exported to China
23% of polymers of ethylene, used in plastics manufacturing
23% of nitrogenous fertilizers, used in agriculture
20% of diamonds, with key processing hubs in Israel and the United Arab Emirates, though they are mined elsewhere
18% of unwrought aluminum