A concentrated fertilizer industry and stubbornly high prices are drawing increased scrutiny from farmers and federal investigators.
The United States Department of Justice is reportedly investigating several leading fertilizer producers to determine whether pricing practices violated civil or criminal antitrust laws. The companies under scrutiny include Nutrien, Mosaic, CF Industries, Koch, and Yara.
The investigation remains in its early stages. Federal antitrust officials have not accused the companies of wrongdoing, and the existence of an investigation does not mean that charges or legal action will follow.
However, Iowa Corn Growers Association President Mark Mueller says the investigation reflects concerns corn producers have raised for years. Mueller began farming near Waverly in 1995 and says he has watched repeated consolidation leave farmers with far fewer fertilizer suppliers.
Mueller says farmers were repeatedly told that consolidation would create efficiencies and lower their costs. He argues those promised savings never reached producers.
The exact level of concentration varies by nutrient and by how the market is measured. Farm Action estimates Nutrien and Mosaic control about 90 percent of North American production capacity for potash and phosphate fertilizers. It estimates Nutrien, CF Industries, Koch, and Yara control about 82 percent of the nitrogen fertilizer market.
Mueller describes that concentration more broadly, saying four companies control roughly 90 percent of the market for the three primary nutrients used to grow corn. While his figure combines several distinct fertilizer markets, available industry estimates support his larger concern that each is dominated by only a small number of companies.
Mueller believes that concentration has contributed to fertilizer prices that do not respond normally to changing market conditions. He says the federal government has heard those concerns from farmers and commodity organizations.
Mueller says he testified before Federal Trade Commission Chairman Andrew Ferguson during an event in Texas. He also says the Iowa Corn Growers Association supports Senator Chuck Grassley’s Fertilizer Transparency Act, which would give USDA greater authority to collect information and investigate fertilizer pricing.
The reported Justice Department investigation is examining whether leading producers colluded to raise prices. No conclusion has been reached, and the companies have not been accused of wrongdoing by antitrust officials.
Mueller says producers recognize that fertilizer prices can rise when global events disrupt energy markets, manufacturing, imports, or transportation. His concern is that those prices have remained elevated even after some of the original pressure began to ease.
Mueller points to price increases following the COVID pandemic, Russia’s invasion of Ukraine, and the conflict with Iran. He says each disruption provided a reason for prices to move higher, but farmers have not seen comparable movement in the opposite direction.
He says ICGA and corn organizations in other states have worked publicly and privately to encourage federal scrutiny and bring more information to farmers about how fertilizer prices are established.
United States Attorney General Todd Blanche acknowledged the industry’s concentration during a recent visit to the Iowa State Fair. Blanche said the Justice Department is working to ensure fair competition while recognizing that fertilizer prices are also affected by overseas production, imports, energy costs, and other global factors.
Associate Attorney General Stanley Woodward said greater transparency could help farmers understand the costs involved in manufacturing and supplying fertilizer.
More from Blanche and Woodward can be found in Mark Magnuson’s report on the Department of Justice response to fertilizer price concerns.
The full interview with Mueller also includes conversations about E15, conservation practices, crop conditions, and other priorities for Iowa corn growers.
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