A new economic analysis published by researchers at Texas A&M University, corn growers are concerned that pending tariffs on nitrogen fertilizers could create shortages and drive prices up even further for farmers, according to the National Corn Growers Association.
“In this study, we performed a historical analysis going back to 1980 and found that fertilizer costs tend to increase as corn revenues increase,” noted lead researcher Joe Outlaw, Ph.D. “Notably, these prices tend to increase exponentially even after accounting for natural gas prices and increased demand.”
The study notes that the price of a type of nitrogen fertilizer, called anhydrous ammonia, increased by $688 per ton — $86,000 for a 1,000-acre farm — from late 2020 to late October 2021.
The study has farmers concerned about a petition by CF Industries, one of the nation’s top nitrogen producers, to the U.S. International Trade Commission to impose tariffs on fertilizers nitrogen imported from Trinidad and Tobago and Russia. The US Department of Commerce has since released a preliminary finding recommending tariffs, despite outcry from farmer groups.
“The proposed tariffs will create shortages and further increase our costs,” said Chris Edgington, an Iowa farmer and president of the National Corn Growers Association. “They will add insult to injury and impose financial hardship on family farms.”
This academic study verifies that nitrogen prices erode the profitability of family farms, Edgington said.
“Our request is simple,” he said. “We’re just asking these companies to keep us out of their business disputes, and they’re doing everything they can to keep their products available and affordable for family farms.”
The study was commissioned by state corn organizations in Texas, Missouri, Colorado, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Maryland , Michigan, Minnesota, Nebraska, New York, North Carolina, North Dakota, Ohio, South Carolina, Dakota, Tennessee and Wisconsin.