U.S. Lawmakers Urge Commerce Department to Lower Tariffs on Morocco’s Phosphate Imports

U.S. Lawmakers Urge Commerce Department to Lower Tariffs on Morocco’s Phosphate Imports

Several influential U.S. Senators and members of the House of Representatives have called on the U.S. Department of Commerce to reduce duty on imports of phosphate fertilizers from Morocco, saying the imposed tariffs have pushed global prices upward affecting U.S. farmers.

The call comes after U.S. Court of International Trade (CIT) ruled lately that Commerce Department made errors when it calculated duty levied on phosphate imports from Moroccan OCP group.

In a letter addressed to Secretary of Commerce Gina Raimondo following the U.S. Court’s ruling, a bipartisan group of 39 lawmakers said since the imposition of the countervailing duty (CVD) on Moroccan phosphate fertilizers in 2020, the supply options to meet U.S. farmers’ phosphate needs have significantly decreased.

Saudi Arabia 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 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,” said the U.S. lawmakers.

While many factors impact the regional and global prices of 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,” said the U.S. Congressmen.

“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,” said the lawmakers, noting that American family farmers need a reliable, diverse supply of many agricultural inputs, including fertilizers.

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