The conflict in the Middle East has renewed scrutiny over transparency in agricultural input pricing.
Nebraska Farm Bureau President Mark McHargue tells Brownfield fertilizer costs have been volatile and the latest geopolitical tensions are raising more concerns.
“We just wonder if there is price gouging,” McHargue said. “I think the importance of having a good relationship with your vendor whether its where you buy fuel from or the co-op you’re dealing with that maybe would help that.”
He says some farmers have also reported difficulty getting fertilizer quotes since the conflict began.
“There have been a few folks saying that they tried to price it and couldn’t get a price on it,” McHargue said. “I haven’t checked (recently) to see if that was a knee jerk reaction or not.”
McHargue says energy markets can react quickly to global instability, even though the U.S. produces much of its own fuel.
“That’s the frustrating part about it is that we have good domestic demand and world conflicts affect the price at least in the short term.”
Eastern Iowa farmer Lance Lillibridge is a past president of Iowa Corn. He says an investigation into pricing and market concentration is long overdue.
“For 40 years we’ve been ignoring antitrust laws in this country, and it’s led to major consolidation,” Lillibridge said. “We don’t have the competition, especially in the fertilizer market, that we used to and that drives up prices. It gives manufacturers market power.”
The Department of Justice and the USDA last fall signed a Memorandum of Understanding to investigate rising input costs, and recently, there have been reports the DOJ’s Antitrust Division has opened an active investigation into major fertilizer producers.
But Lillibridge says he would like to see meaningful action and not “lip service.”
“Something needs to be done, and it needs to be done very quickly,” Lillibridge said. “Hopefully, we’re under an administration that will do that.”
Corn farmers from across the U.S. recently sent a letter to the USDA and the U.S. Attorney General seeking an update on the fertilizer market investigation.
