IMPORT RESTRAINTS HITTING THE HEARTLAND:
SERIOUS FERTILIZER SHORTAGE THREATENS FAMILY FARMERS

Washington, DC: The Consuming Industries Trade Action Coalition (CITAC) today announced its support for Congressional efforts to urge the U.S. Department of Commerce to dismiss a dumping investigation of ammonium nitrate imports from Ukraine that is causing severe shortages of fertilizer for U.S. farmers. 

The situation could cause irreparable harm to the rural economy, said Laura Baughman, CITAC Executive Director and a representative of family farmers. This is a classic example of why there must be reform of U.S. trade laws so that consuming industries have a voice in the process.

U.S. manufacturers of ammonium nitrate, claiming injury due to imports from Ukraine, filed the trade case in October 2000.  The filing will effectively end imports of ammonium nitrate, a key ingredient in fertilizer, to the United States from Ukraine.  These same producers filed a similar case against Russia a year earlier that reduced imports of nitrate from Russia to a trickle.  The loss of these important sources of affordable nitrate has put farmers in a shortage bind.  The import disruption is complicated by the failure of U.S. producers to makeup the shortfall and meet U.S. demand.

According to Baughman, CITAC members see these cases too frequently.  When trade restrictions are imposed, consuming industries often suffer because of lack of available supplies of raw materials, higher prices and longer lead times.  American companies today rely on global markets for their sources of supply.  And yet, they are not full parties to the trade dispute.  Effectively, they have no voice.

These shortages could not come at a worse time for farmers.  In addition to short supply resulting from the anti-dumping investigation of Russia concluded last year, some U.S. manufacturers are opting to sell their natural gas futures on the open market rather than putting it into production of ammonium nitrate to meet farm demand.  Where fertilizer is available, prices have more than doubled since last year.

Our farmers have to make decisions now about spring planting, said Cliff Daugherty, a fertilizer retailer for United Suppliers in Eldora, Iowa.  This ammonium nitrate is an essential input; managing without it could mean planting soybeans instead of corn, resulting in feed shortages and ultimately higher prices for consumers.

CITAC and The Committee for a Competitive AN Market have asked Congress for help, and several Members have sent letters to the Department of Commerce and the ITC on their behalf.  But without quick resolution, yield is likely to fall and other imported fertilizers, though not the kind best suited to family farming, will be substituted.

For the past several years, CITAC has been advocating common sense reform of U.S. trade law that would give consumers a voice in dumping and other cases before the ITC.   The current dumping law does not allow consumer groups or downstream industries impacted by the case to ask the Commerce Department and the ITC to dismiss the case (only petitioners can do this).  Also, though the law allows consumers and downstream industries to submit briefs to the ITC, the ITC is not obligated to consider the impact of imposing a dumping duty on downstream users.  Among CITAC's goals for this year is to propose constructive legislation to ease the excessive burden of trade law on downstream industries. 

CITAC is an association of companies and organizations who are committed to promoting a trade arena where U.S. consuming industries and their workers have access to global markets for imports that enhance the international competitiveness of U.S. firms.