Hearings to examine perspectives on the fertilizer industry, focusing on ensuring a stable and affordable supply for American producers.

1[Senate Hearing 119-408]2[From the U.S. Government Publishing Office]34                                                      S. Hrg. 119-40856                PERSPECTIVES ON THE FERTILIZER INDUSTRY:7                    ENSURING A STABLE AND AFFORDABLE8                     SUPPLY FOR AMERICAN PRODUCERS9=======================================================================1011                                HEARING1213                               BEFORE THE1415                       COMMITTEE ON AGRICULTURE,16                        NUTRITION, AND FORESTRY1718                          UNITED STATES SENATE1920                    ONE HUNDRED NINETEENTH CONGRESS2122                             SECOND SESSION2324                               __________2526                              May 12, 20262728                               __________2930                       Printed for the use of the31           Committee on Agriculture, Nutrition, and Forestry3233[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]3435                  Available on http://www.govinfo.gov/3637                              __________3839                    U.S. GOVERNMENT PUBLISHING OFFICE4063-764 PDF                  WASHINGTON : 202641=======================================================================4243           COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY4445                    JOHN BOOZMAN, Arkansas, Chairman46MITCH McCONNELL, Kentucky            AMY KLOBUCHAR, Minnesota47JOHN HOEVEN, North Dakota            MICHAEL F. BENNET, Colorado48JONI ERNST, Iowa                     TINA SMITH, Minnesota49CINDY HYDE-SMITH, Mississippi        RICHARD J. DURBIN, Illinois50ROGER MARSHALL, Kansas               CORY BOOKER, New Jersey51TOMMY TUBERVILLE, Alabama            BEN RAY LUJAN, New Mexico52JAMES C. JUSTICE, West Virginia      RAPHAEL WARNOCK, Georgia53CHARLES GRASSLEY, Iowa               PETER WELCH, Vermont54JOHN THUNE, South Dakota             JOHN FETTERMAN, Pennsylvania55DEB FISCHER, Nebraska                ADAM SCHIFF, California56JERRY MORAN, Kansas                  ELISSA SLOTKIN, Michigan5758               Fitzhugh Elder IV, Majority Staff Director59                  Corey Weber, Majority Chief Counsel60                    Jessica L. Williams, Chief Clerk61                Lauren Santabar, Minority Staff Director62                 Chu-Yuan Hwang, Minority Chief Counsel6364                            C O N T E N T S6566                              ----------6768                         Tuesday, May 12, 20266970                                                                   Page7172Hearing:7374Perspectives on the Fertilizer Industry: Ensuring a Stable and75  Affordable Supply for American Producers.......................     17677                              ----------7879                    STATEMENTS PRESENTED BY SENATORS8081Boozman, Hon. John, U.S. Senator from the State of Arkansas......     182Klobuchar, Hon. Amy, U.S. Senator from the State of Minnesota....     28384                                WITNESS8586Green, Andy, Principal and Senior Advisor, Center Market87  Strategies, Washington, DC.....................................     588Kubik, Trent, President, South Dakota Corn Growers, Hamill, South89  Dakota.........................................................     790Melton, Eddie, President, Kentucky Farm Bureau Federation,91  Louisville, Kentucky...........................................     992Rosenbusch, Corey, President and CEO, The Fertilizer Institute,93  Arlington, Virginia............................................    1094Westling, Joshua, CEO, J. Westling & Co., LLC, Omaha, Nebraska...    1295                              ----------9697                                APPENDIX9899Prepared Statements:100    Green, Andy..................................................    42101    Kubik, Trent.................................................    60102    Melton, Eddie................................................    72103    Rosenbusch, Corey............................................    81104    Westling, Joshua.............................................   117105106Document(s) Submitted for the Record:107Boozman, Hon. John:108    Eggnite Agricultural Solutions, LLC, Letter for the Record...   126109    Op-Ed: Secretary Brooke Rollins: President Trump is ensuring110      fertilizer affordability and availability for our farmers..   133111    The United Steel, Paper and Forestry, Rubber, Manufacturing,112      Energy, Allied Industrial and Service Workers International113      Union (USW), Letter for the Record.........................   135114    Stephen Vaden, Deputy Secretary of Agriculture, Letter for115      the Record.................................................   137116McConnell, Hon. Mitch:117    Prepared statement from Senator Mitch McConnell..............   138118119Question and Answer:120Melton, Eddie:121    Written response to questions from Hon. Adam Schiff..........   144122Rosenbusch, Corey:123    Written response to questions from Hon. Adam Schiff..........   146124125    PERSPECTIVES ON THE FERTILIZER INDUSTRY: ENSURING A STABLE AND126                AFFORDABLE SUPPLY FOR AMERICAN PRODUCERS127128                              ----------129130                         TUESDAY, MAY 12, 2026131132                                        U.S. Senate133          Committee on Agriculture, Nutrition, and Forestry134                                                    Washington, DC.135    The Committee met, pursuant to notice, at 3 p.m., in Room136106, Dirksen Senate Office Building, Hon. John Boozman,137Chairman of the Committee, presiding.138    Present: Senators Boozman [presiding], McConnell, Hoeven,139Ernst, Marshall, Justice, Grassley, Thune, Fischer, Moran,140Klobuchar, Smith, Lujan, Warnock, Welch, Schiff, and Slotkin.141142   STATEMENT OF HON. BOOZMAN, U.S. SENATOR FROM THE STATE OF143 ARKANSAS, CHAIRMAN, U.S. COMMITTEE ON AGRICULTURE, NUTRITION,144                          AND FORESTRY145146    Chairman Boozman. Thank all of you very much for being here147today. As we all know, this hearing is being held during what148continues to be a very precarious time across America's149agricultural economy. I would call that an understatement. I150would say it is a generational event.151    While input prices for our producers have been stubbornly152high for the past several years, this situation has recently153become more acute as farm bankruptcies increase, fuel prices154remain high, and interest rates have yet to come down. The cost155of fertilizer, the topic of today's hearing, has also gone up,156and I look forward to hearing from our witnesses about the157current state of the fertilizer industry, how these high prices158directly affect our producers, and what potential solutions159exist for Congress to ensure a stable and affordable supply of160this important crop input. Again, this is a national security161issue.162    This is not a simple problem to address, as fertilizer is163not a single, uniform input. Nitrogen, phosphate, and164potassium, commonly referred to as N, P, and K, present a165complicated picture of global supply chains that have been166affected by the war in Ukraine, trade disputes that have also167resulted in countervailing duties, and the recent conflict in168the Middle East. Today's hearing is an important opportunity to169learn more about how these factors, and others, directly impact170producer costs.171    I want to commend the Trump Administration for the172attention it has given to high fertilizer prices. Over the last173couple months, the Administration has responded by waiving the174Jones Act and refocusing the Fertilizer Product Expansion175Program to ensure projects funded under this program are up and176running as soon as possible.177    In November, U.S. Department of Interior Secretary Doug178Burgum also announced the addition of phosphate and potash to179the crucial minerals list, which will streamline regulatory180hurdles and increase domestic production of these fertilizer181inputs. These minerals' important to food security, which is182national security, were clear, and this was a welcome and much-183needed change.184    U.S. Department of Agriculture Secretary Rollins has185continued to engage with our producers and brought together her186colleagues from across the Administration to determine what187additional steps they can take to provide relief.188    Several Members of this Committee have also proposed189legislative solutions to address higher fertilizer prices, and190I welcome hearing from our witnesses about proposals. How they191may help; and what additional actions Congress and the192Administration might take to ensure a reliable and accessible193affordable supply of fertilizer for hardworking American194farmers.195    With our colleagues in the House successfully passing a196bipartisan farm bill 2.0, I look forward to engaging with the197Members of this Committee on what we learn today to ensure a198Senate version addresses the urgent needs of agriculture.199Congress owes our Nation's producers an updated farm bill that200will complement the improvements we made last year in the One201Big Beautiful Bill, and I am committed to making that happen.202    While the proposals and solutions we hear about today may203help increase production of fertilizer and bring down prices in204the long-term, in the immediate future, Congress must provide205additional assistance to supplement what USDA provided with the206Farmer Bridge Payments and the Assistance for Specialty Crop207Farmers programs, to ensure producers have the working capital208available to see them through the 2026 crop season.209    I have been working with my friend, Senator Hoeven, to210advocate for this assistance and appreciate President Trump's211acknowledgement of this need when a larger supplemental funding212package is requested.213    Before I turn it over to Ranking Member Klobuchar for her214opening statement, I ask unanimous consent that statements sent215to the Committee for this hearing be included in the record,216including an op-ed written by USDA Secretary Rollins and a217statement submitted to the Committee by Deputy Secretary Vaden.218Without objection, so ordered.219    [The letters can be found on pages 126-137 in the220appendix.]221    Chairman Boozman. Again, I thank my colleagues and our222witnesses for being here today.223    With that, I now turn to Ranking Member Klobuchar for her224opening statement.225226  STATEMENT OF HON. KLOBUCHAR, U.S. SENATOR FROM THE STATE OF227                           MINNESOTA228229    Senator Klobuchar. Thank you very much, Chairman Boozman,230and thank you for holding this important hearing today and for231bringing such distinguished witnesses. In particular, I would232mention the farmers who have come to Washington in the middle233of planting season to share their perspective. Thank you for234doing that, including a number from Minnesota.235    As we hear from our witnesses today, I would say that236farmers need policies that encourage new investment, reduce237supply disruptions, and improve transparency in the fertilizer238market. We know there are many reasons that fertilizer prices239are astronomically high. They were high before the war started,240but I will note that there is a direct link between recent241escalations and this war.242    In the months since the President started the war, with no243consultation or authorization from Congress, fertilizer244prices--urea has spiked more than 40 percent, and the cost of245diesel has hit near record highs in Midwest states. Now, why?246Well, nearly half of the global urea goes through the Strait of247Hormuz. Thirty percent of ammonia goes through the Strait of248Hormuz.249    Yet even before the war, farmers were walloped by the250presence of across-the-board tariffs. An analysis by North251Dakota State University--you may not like the result, go Bison,252here is what it found--found that IEEPA tariffs added nearly $1253billion in costs to critical inputs like fertilizer, seed,254machinery, and chemicals from February through October of last255year.256    I was at the Supreme Court argument, and as you are well257aware, the Supreme Court found the tariffs illegal. Last week,258the Court of International Trade ruled against the President's259authorities to use a different statute for these tariffs.260Again, they are not targeted. They are across the board, and it261has led to part of these problems.262    Just last month, I was at a family farm in Cannon Falls,263Minnesota, where I met with corn and soybean farmers who are264facing escalating costs this planting season. Many of them said265stubbornly high fertilizer prices have been an issue for years266in a market with little competition. Some of them were able to267lock in before the war, not knowing it was going to happen, but268others now are even in worse shape.269    Beyond the geopolitical challenges, there are other270reasons: farmers have just a handful of domestic suppliers to271choose from, with little transparency about the prices that272they ultimately pay. In 2024, just four fertilizer companies273accounted for 77 percent of U.S. nitrogen fertilizer sales and274all domestic potash and phosphate. That is why I partnered with275Senator Thune, who is here with us, and farmers in our states,276to introduce the Fertilizer Price Transparency Act to create a277mandatory price reporting structure at USDA to ensure farmers278and co-ops have adequate market information on fertilizer279components, especially at times when we see major supply chain280shocks. We believe getting this information out there would be281very helpful.282    Aside from price transparency, we need to increase domestic283fertilizer production and storage. Senator Marshall, who is284also with us, and I have introduced the Homegrown Fertilizer285Act to do just that, so we can ease our dependence on imports.286I know Senator Grassley and others on this Committee have287introduced other pieces of legislation to address these issues.288    Acting now will ultimately help stabilize prices and give289farmers the certainty they need. It is going to have to be a290combination of things: ending the tariffs, or reducing them, or291making them much more targeted, ending this war, finding a way292to resolve it, so the Strait of Hormuz is open again, and then293going at this long-term systemic problem about the lack of294competition in this area.295    Thank you to our witnesses today.296    Chairman Boozman. Thank you. We will now introduce our297witnesses.298    We are going to Senator McConnell first to introduce our299witness from Kentucky.300    Senator McConnell. Thank you, Mr. Chairman. You know how301politicians frequently refer to each other as ``my friend'' or302``my good friend.'' It is usually not true.303    [Laughter.]304    Senator McConnell. Frequently, we say that about some of305our constituents. I have got a prepared text here. I am going306to ask the Chairman to put it in the record.307    [The letter can be found on pages 138-141 in the appendix.]308    I want to tell you about Eddie Melton. We have been309literally friends for decades. We have worked together on issue310after issue after issue for a big part of the 42 years I have311been here. He is bright as hell and is extremely creative.312    Example, a year or so ago, he came to me and said, ``I'm313really, really concerned, as I'm sure we all are, about the314loss of farmland.'' Not only did he say he was concerned about315it, he had an idea about how to make it less likely to happen,316which was to give a tax relief proposal for people who bought a317farm if they agreed to continue farming for at least 10 years.318    I took that idea and put it in the Big Beautiful Bill. It319is law. If Eddie had not thought of that it would not have320happened.321    I can tell you, he has made a difference, not only for322Kentucky agriculture but for agriculture all across the323country. I just wanted to come by, Eddie, and thank you for all324you have done.325    Thank you, Mr. Chairman.326    Chairman Boozman. Thank you very much. Senator Klobuchar.327    Senator Klobuchar. Thank you very much, Mr. Chair. It is my328pleasure to welcome Andy Green to the Committee today. Mr.329Green is a partner in Center Market Strategies, a bipartisan330firm dedicated to keeping markets fair, and ensuring a seat at331the table for businesses of all sizes. He previously served as332the first senior advisor for Fair and Competitive Markets at333the USDA during the previous administration, where he334spearheaded efforts to promote competitive markets across335agriculture.336    In addition, he worked for the Public Company Accounting337Oversight Board, the U.S. Securities and Exchange Commission,338and started his career in D.C. here in the Senate for Senator339Merkley of Oregon. Thank you for joining us today.340    Chairman Boozman. Senator Thune.341    Senator Thune. Thank you, Mr. Chairman, and by the way,342thank you for shining a light on this really important subject.343I am glad we are having this hearing. We need to get to the344bottom of one of the biggest challenges farmers are facing345these days, and that is the cost of inputs, particularly346fertilizer.347    It is my pleasure, Mr. Chairman, to introduce to the348Committee Trent Kubik. He is not only the current President of349the South Dakota Corn Growers but also a farmer and a rancher,350along with his wife and parents. They farm near Hamill, South351Dakota, raise corn, soybeans, alfalfa, and milo, alongside352their cow-calf operation. By the way, for any of you who have353been to South Dakota, in that part of South Dakota, they also354have a very, very abundant pheasant supply.355    Trent graduated from South Dakota State University with a356degree in agronomy. He and his wife Shannon have two sons. He357stays very busy as a certified crop advisor and as a358volunteer--FFA and 4-H volunteer, and he is a very active359member of his church. I know also that he is a person--a man--360of great courage because he is a diehard Green Bay Packer fan361in Viking country, which is a distinction that we share, by the362way.363    I am very pleased to have him here today and look forward364to hearing a South Dakota perspective on this issue. Trent,365welcome.366    Thank you, Mr. Chairman.367    Chairman Boozman. Corey Rosenbusch serves as The Fertilizer368Institute's President and CEO, where he is responsible for369leading efforts to advance the fertilizer industry. Before370joining TFI, Mr. Rosenbusch served as President and CEO for the371Global Cold Chain Alliance and worked for The Borlaug372Institute. Mr. Rosenbusch holds a degree in international373development from Harvard University, a bachelor of science374degree in agriculture education from Texas A&M. That is a375combination. We appreciate you being here very, very much.376Senator Fischer.377    Senator Fischer. Thank you, Mr. Chairman. I am pleased378today to introduce Mr. Joshua Westling, who is here today as a379witness for this Committee on a very, very important subject.380Mr. Westling is leading the development of Project Meadowlark,381a new fertilizer plant in Gothenburg, Nebraska. This facility382is projected to produce 5,000 tons of liquid fertilizer and383reach commercial operation. I am afraid not until 2029.384    Before working on Project Meadowlark, Mr. Westling led the385development and construction of an anhydrous ammonia plant in386Geneva, Nebraska, that became one of the few greenfield387nitrogen fertilizer facilities built here in this country.388    Mr. Westling, we are so happy to see you here today, and I389look forward to your comments. Thank you.390    Chairman Boozman. Thank you. Mr. Green, you are recognized.391392 STATEMENT OF ANDY GREEN, PRINCIPAL AND SENIOR ADVISOR, CENTER393               MARKET STRATEGIES, WASHINGTON, DC394395    Mr. Green. Thank you, Chairman Boozman and Ranking Member396Klobuchar, for the opportunity to testify this afternoon.397    We are here because the American farmer is hurting. For398more than five years, farmers have endured both price spikes399and sustained higher prices, squeezing their margins and400affecting their planting choices.401    It is well known that fertilizer markets are highly402concentrated. Indeed, one relatively recent merger created a403giant that controls six percent of one type of fertilizer and40430 percent of the market for another. Amazingly, Federal Trade405Commission economists took a victory lap barely two years after406its completion to say everything is fine. That was a mistake.407    What are the pillars of building fair, more competitive408fertilizer markets? First, enforcement. I am pleased to see409this Administration has prioritized investigations into410agricultural competition around both agricultural inputs and411cattle markets. I hope their efforts yield fruit. I would be412pleased if they were building on the groundwork laid out413previously, for example, with the Agri Stats case.414    High, sustained increases in profits should also be cause415for antitrust scrutiny, particularly in light of market shocks416that are repeating today. To that end, it may be appropriate to417reconsider those recent mergers that have helped form this418highly concentrated sector. Effective enforcement of the law419also requires funding and staffing at agencies, including USDA.420    Second, more transparency would be beneficial for a more421accountable fertilizer market. Kudos to the bipartisan sponsors422of legislation to enhance USDA's role in providing additional423transparency, including, in particular, S. 4152, the Fertilizer424Transparency Act of 2026.425    Public reporting can highlight, and in some cases, deter426problematic trends, for example, where there is a disconnect427between price and underlying supply and demand. In that way,428transparency can lead to beneficial outcomes for farmers even429beyond their use of the information itself. I also commend the430legislation for its use of modern dashboards, and the bill431appropriately preserves the ability for the data to be used for432enforcement purposes. Additionally, regular public company433disclosures should be preserved and enhanced as valuable for434both investors' and for farmers' risk management.435    Third, investment in an important tool for enhancing436competitive markets. The Fertilizer Production Expansion437Program, FPEP, was USDA's $900 million commitment to support438American-made sustainable fertilizer capacity in the face of439similarly sharply increasing prices and long-term trends toward440concentration. Over the course of three years, FPEP invested441over $778 million in more than 100 projects across 39 states.442That adds up to an estimated 12 million tons of new production443online and more than 1,500 jobs. More than $100 million remains444available to the program, and more via the CCC.445    Funding for USDA's Rural Cooperative and Business Services446and the Agricultural Marketing Service are important for these447types of efforts and others that benefit more choices for448farmers.449    Fourth, consumers can support pro-competition initiatives450incentives upstream for farmers. Clear labels for consumers451help producers that actually do the hard work of delivering452value-added products that consumers want. In fertilizer,453opportunities may exist to align America's desire for healthy454food and a clean environment with competition and resiliency in455fertilizer. Expanding biofertilizer and nutrient recycling456options for farmers should be part of the equation.457    Fifth and finally, economic research and academic legal458analysis are foundational aspects of building and maintaining459effective market competition. Government investment in460objective, unbiased research, such as the land-grant university461system, helps policymakers identify trends and design462interventions to restore market competitiveness.463    I want to particularly highlight the importance of research464into seed resiliency. New varieties can help support more465efficient fertilizer choices. To that end, special attention466should go to ensuring the maintenance and staffing for the467Agricultural Research Service's National Plant Germplasm System468to avoid the loss of irreplaceable genetics, including in corn.469    In conclusion, more can and should be done on a bipartisan470basis to enhance competition in the fertilizer sector so that471America's farmers can compete based on hard work, smart472investments, and nature's abundance. Thank you very much.473    [The prepared statement of Mr. Green can be found on pages47442-59 in the appendix.]475    Chairman Boozman. Thank you. Mr. Kubik.476477STATEMENT OF TRENT KUBIK, PRESIDENT, SOUTH DAKOTA CORN GROWERS,478                           HAMILL, SD479480    Mr. Kubik. Chairman Boozman, Ranking Member Klobuchar, and481Members of the Senate Agriculture Committee, thank you for the482opportunity to speak here today. My name is Trent Kubik. I am a483farmer from Hamill, South Dakota, and President of the South484Dakota Corn Growers Association.485    I farm in an area of the country where weather varies much486more than normal, and more often than not, we are threatened by487lack of rainfall. Due to this, we try and limit the amount of488fertilizer we purchase and apply at the start of the year to489determine if we need more while the crop is growing, which, in490turn, does not allow us to early book and/or prepay all of our491fertilizer needs.492    In the first few months of this year, we were not in a493position to book or prepay for any fertilizer, so we expected494our costs were going to be higher than normal, as we would be495purchasing closer to peak demand season, but now we are left496with costs nearly doubling. This leads me to ask, what is497causing fertilizer to increase in price?498    Despite the cost of natural gas in the U.S. being499relatively cheaper than any fertilizer-producing area in the500world, the price of nitrogen fertilizer in the U.S. has501continued to rise in concert with prices in areas with higher-502costing natural gas. The resulting rise in margins for U.S.503manufacturers should, in theory, encourage expansion of504production and higher capacity utilization for the industry.505Instead, market power has allowed manufacturers to maintain506higher prices at the expense of the U.S. farmer.507    In fact, last week, a Bloomberg article showed the recent508earning reports indicate record profits for fertilizer509companies. When my input price goes up, my profit margin510shrinks. I will be frank. It is unclear to corn farmers in511South Dakota how the opposite is possible for the fertilizer512industry.513    What I do know is that profit increase illustrate an514industry that does not have to increase my fertilizer prices515but can do so. In my written testimony, I also included516analysis that indicated the use of market power to directly517impact fertilizer pricing. An analysis conducted in 2024518illustrated the producer price index, measuring the change in519price of goods sold, both for corn and nitrogen, indicating520that nitrogen fertilizer prices nearly precisely tracked521increases in corn prices.522    What is the structure of this marketplace? Over the past 40523years, fewer and fewer fertilizer firms serve the U.S. farmer,524due in no small part to industry mergers. By almost any525measure, these are highly concentrated markets.526    In addition, large manufacturers appear to have developed527and to own distribution networks. For instance, Nutrien528operates the largest direct-to-grower distribution network with529distribution points and retail locations. Unfortunately, there530is limited publicly available information regarding531distributors and wholesalers.532    It is important to note that vertical integration has not533led to the efficiency gains passed on to growers and consumers.534Instead, our experience is that the integration has resulted in535the largest fertilizer companies locking up and leveraging536distribution channels, entrenching their dominant position, and537extracting excessive profits from farmers and consumers. Market538power allows even the simple act of storing these products to539be turned against the farmer.540    For instance, it is my understanding that the fertilizer541manufacturers are able to park barges of product and hold onto542inventory. In addition, under a scenario where there are only543two market participants, the first market participant could set544the price for a barge of fertilizer, with the second one545following at that price. It is easy to see how this might546occur.547    We also need the ability of manufacturers to exert pressure548downstream on wholesalers and retailers to be mitigated. As I549have already mentioned, there is not significant amounts of550information available to the public about wholesalers. I have551heard credible reports of practices that undoubtedly could552affect farmers, such as the delay in availability of fertilizer553books by a retailer, but it is difficult to assess what is554really happening, due to the opaque nature of parts of that555supply chain.556    Two key pieces of legislation would be helpful to begin to557provide the type of data needed to assess the use of market558output control. The Fertilizer Transparency Act of 2026 would559increase the data available to help improve market signals by560providing public access to meaningful pricing data and give561farmers a tool to help plan for these costs. Ultimately, this562legislation will make the market for key farm inputs more563transparent and therefore represent a step toward making the564market more competitive. It also might help provide data that565would aid in the analysis of whether market control has been566used to limit the supply of fertilizer. We greatly appreciate567South Dakota Senator John Thune and Ranking Member Klobuchar568for introducing this much-needed step toward market569transparency.570    In addition, the Fertilizer Research Act authorizes a study571on fertilizer competition trends and pricing. This bill also572increases transparency and would provide much-needed573information to better assess the marketplace, including key574data such as sectors capacity utilization rates. We thank575Senate Judiciary Chair Chuck Grassley and Senator Tammy Baldwin576for introducing this bill.577    Simply put, farmers need more competition in this578marketplace. We thank the U.S. Department of Ag Deputy579Secretary Stephen Vaden for his significant interest in this580area and call upon the federal agencies that signed the581September 2025 Memorandum of Understanding to take meaningful582steps toward solutions to concentration in this subsector.583Federal antitrust laws exist for precisely this reason, to584promote and sustain competition, the lifeblood of our economy.585    Increased competition for more participants in the586fertilizer manufacturing space is the only thing that can587deliver meaningful and durable price relief.588    Thank you again for the opportunity to be here and thank589you to Chairman Boozman and Ranking Member Klobuchar for taking590up such a critical issue of fertilizer. I look forward to your591questions.592    [The prepared statement of Mr. Kubik can be found on pages59360-71 in the appendix.]594    Chairman Boozman. Thank you very much. Mr. Melton.595596  STATEMENT OF EDDIE MELTON, PRESIDENT, KENTUCKY FARM BUREAU597                   FEDERATION, LOUISVILLE, KY598599    Mr. Melton. Chairman Boozman, Ranking Member Klobuchar, and600Members of the Senate Ag Committee, my name is Eddie Melton and601I am fifth-generation row crop and beef cattle farmer from602Webster County, Kentucky, and I currently serve as President of603Kentucky Farm Bureau. It is an honor to be with you today to604speak on behalf of the farmers of Kentucky as well as the605470,000 Kentucky Farm Bureau member families.606    My family has been farming in Webster County since 1900,607when my great-great-grandfather purchased our farm. During my608lifetime, I have helped bring in more than 50 years of crops.609We typically raise corn, soybeans, canola, wheat, and beef610cattle. My business partner, Patrick Howard, and I made a611decision last August to not plant wheat and canola, due to the612increased fertilizer price. This is the kind of decisions613farmers across the country have had to make.614    This hearing comes at a critical time as we assess the615current state of the farm economy and the ongoing challenges616facing American agriculture. Today's fertilizer price617challenges do not begin with the recent conflict in Iran. While618global tensions often draw attention to input markets, prices619for fertilizer have been elevated for years. Though the current620crisis is not new, disruptions in the Strait of Hormuz have,621beyond a doubt, exacerbated the problem. The shipping622disruptions contributed to an increase in the price of nitrogen623fertilizer. The unpredictability in the region has led to624concerns about availability, not for just this current crop625year but also for next year, as well.626    Since February, we have seen a 33 percent rise in anhydrous627prices, a 55 percent rise in urea prices, and a 25 percent628increase in liquid nitrogen. All the while, corn prices have629declined from $7 a bushel in 2022 to approximately $4.50 per630bushel today. Meanwhile, many farmers are operating with little631or no working capital, limiting their ability to manage risk or632invest in future production.633    In the first quarter of 2026, 86 farms have already filed634for Chapter 12 bankruptcy, including 25 of those in the635southeastern region.636    Last month, American Farm Bureau Federation conducted a637Fertilizer Availability Survey of more than 5,700 farmers and638ranchers nationwide. The results highlight significant639challenges in fertilizer access. Affordability challenges are640especially acute in the South, with roughly 78 percent of the641respondents indicating that they were unable to afford all the642fertilizer they need. In my home State of Kentucky, just 29643percent of farmers were reported to be able to prebook644fertilizer, with almost 72 percent stating that they could not645afford all the fertilizer that they needed this growing season.646    Addressing these challenges requires both immediate and647long-term action. In the near term, greater transparency in the648fertilizer market and ensuring farmers have access to the649fertilizer they need to get through this growing season is650essential. We appreciate the efforts of the Administration so651far, but we continue to call on the President and Congress to652do everything in their power to increase availability of653fertilizer and ease the price burdens on farmers this growing654season.655    Over the longer term, the United States must strengthen its656domestic fertilizer production capacity. We are grateful to the657Administration, especially Secretary Rollins and the team at658USDA, for the work on this issue. Expanding domestic production659would improve supply reliability and help moderate price660volatility over time.661    These challenges facing agriculture today are the result of662sustained economic pressure that is reshaping the farm economy.663According to the last USDA census, we lost more than 20 million664acres of farmland and almost 200,000 farms nationwide. If farm665closures, farmland loss, and consolidation continue, the long-666term structure of American agriculture will begin to change.667Ensuring that producers have access to affordable inputs and668fair, transparent markets is critical, not only for their669operations but for the long-term stability of American670agriculture and national food security.671    For producers operating on thin margins, there is no672flexibility to wait for longer-term solutions. That is why673near-term support matters. Congress should act now with674additional economic assistance to help farmers manage today's675cost pressures to prevent further financial strain and676stabilize operations while longer-term fixes are put in place.677    Chairman Boozman, Ranking Member Klobuchar, and Members of678the Committee, thank you for the opportunity to speak to you679today as both as a farmer and as President of Kentucky Farm680Bureau. This Committee's work is so important to agriculture681and the farm economy to ensure the reliable supply of food,682fiber, and fuel for generations to come. Thank you.683    [The prepared statement of Mr. Melton can be found on pages68472-80 in the appendix.]685    Chairman Boozman. Thank you. Mr. Rosenbusch.686687     STATEMENT OF COREY ROSENBUSCH, PRESIDENT AND CEO, THE688              FERTILIZER INSTITUTE, ARLINGTON, VA689690    Mr. Rosenbusch. Thank you, Chairman Boozman, Ranking Member691Klobuchar, and Members of the Committee.692    The Fertilizer Institute represents manufacturers,693importers, wholesalers, and retailers who serve America's694farmers. There are over 500 producers of fertilizer globally,695and the United States is one of three countries that has more696than 20 unique companies producing fertilizer. Half of all the697crop yields in the world today are only possible through the698use of these crop nutrients. Thank you, farmers, because699without farmers, there would be no fertilizer industry.700    I grew up in a small Texas town where my dad was my FFA701advisor, and it was really FFA that broadened my horizons to702leave rural America and move to Indonesia, where I spent three703years helping smallholder farmers. It was really that704experience that shaped my view on agriculture. Whether you farm705in Indonesia or in Iowa, farmers are highly exposed to global706markets.707    Fertilizer is one of those global markets, which is not a708single product, but they are typically represented by three709macronutrients, nitrogen, phosphate, and potash, each with its710own unique market dynamics.711    The United States does have significant production of712nitrogen and phosphate, and while we do have some potash713production, we import over 98 percent. The U.S. only accounts714for seven percent of total global fertilizer production, and we715are a net importer of fertilizer. Over 90 percent of all716fertilizers applied in the world are actually used outside of717the United States.718    We also have one of the world's most sophisticated719logistics systems to enable large-scale delivery of fertilizer.720That infrastructure helps support strong competition and721options for farmers, from both domestic and international722suppliers to the market.723    Please hear this. Fertilizer is a globally traded commodity724that is subject to fierce competition and global supply and725demand.726    To understand that supply and demand, we really have to727begin with geopolitics, starting with Iran. The closure of the728Strait of Hormuz impacted about 34 percent of globally traded729urea, 20 percent of phosphate, and half of the world's sulfur730exports. Iran itself is actually the second-largest exporter of731urea, with about 12 percent of the marketplace. Twenty percent732of the natural gas is supplied from the region, and natural gas733is the feedstock, of course, for all nitrogen fertilizer.734    The Strait is really only part of the story. There have735been 31 ammonia plants in the region that have curtailed736production or have been damaged during the conflict. Another 49737plants in India and South Asia were also shuttered due to738disruption of their natural gas supply from the region. Even739with the Strait reopening, we do not know the extent of the740damage to those production facilities.741    These issues really just exacerbated what was already a742very tight global supply. China, who is the world's largest743producer of fertilizer, with about a third of all nitrogen744production and 43 percent of the global phosphate supply, are745currently restricting all of their exports. Twenty Russian746nitrogen plants have been damaged due to Ukrainian drone747strikes, and Russia also has implemented an export ban on their748fertilizer, or restriction.749    At the same time, we are also experiencing strong demand750for fertilizer. For example, in India, the world's second-751largest consumer of fertilizer behind China, their Federal752Government procures their fertilizer. They then heavily753subsidize it to keep prices low for their farmers. Because a754significant volume of urea was stranded behind the Strait,755India recently did another urea tender for 2.5 million metric756tons of urea, at nearly $1,000 per metric ton.757    We recognize that this is a very challenging and758frustrating time for our farmers, that are already experiencing759very low crop prices. That is why we would like to be a760partner, to develop solutions.761    In the interest of time, I will refer to my written762testimony for some of those solutions, but we support policies763that bolster domestic supply. Ammonia facilities can take more764than five years and cost $4 to $5 billion to build, or a decade765or more for development of a potash or phosphate mine.766    We also support transparency. Farmers need a reliable767source of data and market information. We have proposed the768creation of a crop input economist at USDA that can analyze769price information and supply factors to aid farmers in their770decision-making.771    Even with these policy solutions, I want to be clear that772fertilizer is a globally traded commodity. While we cannot773directly influence prices, we can produce productive policies774to bolster domestic supply that mitigates geopolitical risks775for the American farmer. Thank you.776    [The prepared statement of Mr. Rosenbusch can be found on777pages 81-116 in the appendix.]778    Chairman Boozman. Thank you. Mr. Westling.779780  STATEMENT OF JOSHUA WESTLING, CEO, J. WESTLING & CO., LLC,781                           OMAHA, NE782783    Mr. Westling. Chairman Boozman, Ranking Member Klobuchar,784Members of the Committee, thank you, and Senator Fischer, thank785you for the introduction.786    My name is Joshua Westling. I am the Founder and CEO of J787Westling & Company, and I am leading the development of Project788Meadowlark, a new domestic fertilizer complex in Gothenburg,789Nebraska. I am the only developer of new domestic fertilizer790capacity testifying today, and I want to give you a candid view791from the front line.792    Six years ago, I started working on this project because793the fertilizer supply problem in our region was getting worse,794and nobody was solving it. Nebraska is consistently one of the795largest agricultural markets in the United States, with farm796cash receipts approaching $40 billion annually, and we are one797of the largest markets for UAN and ATS in the country, yet798local production of nitrogen fertilizer is minimal relative to799what we consume. The cost of moving fertilizer to where it is800needed and the consequences when it does not arrive on time are801borne by our farmers. Very often, they are also exposed to802supply disruptions, thousands of miles away from their803operations.804    Project Meadowlark helps change that. Once it reaches805commercial operation in 2029, it will produce 365,000 tons of806UAN per year, 140,000 tons of ATS, and 52,000 tons of diesel807exhaust fluid. The plant is fully integrated. We produce808ammonia as an intermediate, but every pound is converted onsite809into products our farmers and truckers actually use.810    This is the second greenfield nitrogen fertilizer plant I811will have developed. When Fortigen came online in 2018, it was812one of only three greenfield nitrogen fertilizer plants of813meaningful scale built in the United States in over 30 years.814Project Meadowlark will be the fourth. My team and I have done815this before.816    The total budget for this project is over $1 billion817dollars. We have raised over $50 million in predevelopment818capital to date, the substantial majority from regional819investors, farmer-aligned partners, and members of our820community. These are the people who understand the supply821problem most directly, because they live it every season. They822have always believed the Federal Government should have a role823in solving this problem, but they also recognize the government824often acts only in response to crisis, so they took the825initiative. I am honored and humbled by their support. I take826very seriously the responsibility of delivering what we say we827will deliver. When farmers are putting their own capital into828restoring domestic fertilizer production that is essential to829our Nation's farm and food security, that is rural America830trying to tell you something.831    One challenge unique to fertilizer projects is that so832little domestic nitrogen capacity has been built in the United833States over the past several decades. Unlike sectors such as834power generation or data centers, there are relatively few835recent reference projects for institutional investors, lenders,836engineers, and contractors to rely upon. As a result,837substantially more diligence, engineering work, and development838capital are required before large-scale, private capital can839move with confidence. Early-stage funding, through any number840of mechanisms, is one of the biggest areas of opportunity for841any capital deployment program, new or pursuing.842    I support the framework announced on April 29th by843Secretaries Rollins, Lutnick, and Bergum, Administrator Zeldin,844Director Hassett, and others as a serious response to a serious845problem, and this Committee's bipartisan engagement is exactly846what this moment requires. If domestic fertilizer production is847truly a strategic infrastructure, then we need to finance and848permit it like strategic infrastructure.849    I want to use my remaining time to highlight three850additional steps that would meaningfully strengthen American851farm and food security. First, predictability and execution852certainty. If domestic fertilizer capacity is truly a strategic853priority then federal timelines must operate with the urgency854that this priority requires. Clear and predictable timelines855allow private capital to move faster on strategically important856projects to come online sooner.857    Second, coordination across agencies and programs. Large858industrial projects move through multiple federal processes859simultaneously. When agencies operate independently, delays860compound and timelines stretch unnecessarily. Better861coordination would materially accelerate the deployment of862private capital into strategically important domestic capacity.863    Third, urgency. If Congress and the Administration believe864domestic fertilizer production is critical to American food and865national security then we should act like it. Every year of866delay is another planting cycle exposed to fragile supply867chains and foreign dependency. Projects like ours are ready to868move. The faster strategic federal support becomes real and869deployable, the faster new domestic capacity comes online.870    Three years from now, the measure of success will not be871how many frameworks were announced or how many hearings were872held. It will be whether new domestic fertilizer capacity873actually came online in the United States. This Committee has874the opportunity to help ensure that projects like ours move875fast enough to matter.876    I am grateful for your attention to this issue, and for the877bipartisan seriousness this Committee has brought to the878problem. I look forward to your questions and thank you.879    [The prepared statement of Mr. Westling can be found on880page 117-123 in the appendix.]881    Chairman Boozman. Thank you very much. We are going to go882to our round of questions, and I am going to allow Senator883Thune to take my place in the order. We appreciate the fact884that even though he is the majority leader he is one of our885most active Members.886    Senator Thune. Thank you.887    Chairman Boozman. He has not forgotten his roots.888    Senator Thune. Thank you, Mr. Chairman, and you can count889on that. Thank you again for your leadership on this, and890Senator Klobuchar, for taking on this issue. Let me add, I891would be remiss, and I know this is not the subject here, but892we need to get E15 done. That solves a couple of important893problems, one of which is demand for corn in this country, at a894time when we are losing some of our export markets. Secondly,895increasing the supply of fuel in this country, at a time when896gas prices are going up. As an economic matter, it makes all897the sense in the world.898    I deviate, and I understand, and thank you for your899indulgence on that subject.900    I want to thank all of our panelists for being here today901and for sharing your thoughts on the impact of fertilizer902prices and supply chains on the ag economy. These high input903costs, adverse weather conditions, low commodity provides all904impact our ag economy, and it is important that Congress905continue its work toward long-term solutions that support the906entire ag industry. I am very proud of what we did last summer907in the Working Families Tax Cuts to increase reference prices908for ARC and PLC, improve crop insurance protection, and update909disaster programs.910    I will say there remains more to be done. All of the911Members of this Committee know that rising input costs have912been eating into producers' bottom lines over the last several913years, particularly, I would add, the price of fertilizer. This914steep increase would shrink or altogether eliminate any915grower's profit margins, even during times of strong commodity916prices. It needs to be addressed.917    Mr. Kubik, would you elaborate on how the price you have918paid for nitrogen and phosphate fertilizer has changed over the919last several years and how those changes have impacted your920planting decisions over the last few years?921    Mr. Kubik. Thank you, Senator, for that question. I did go922back and look. From 2020 to 2026, kind of where the trend in923fertilizer, I got a little bit of PTSD from 2022, I will be924honest, and I must have blocked it out of my memory, because I925cannot believe we paid that much for fertilizer in 2022.926    Just for reference, in 2020, my farm paid $355 for a ton of927urea. By the time 2022 hit, that price jumped to $830. A little928bit of retract in 2023 and 2024 to $400 and $500, $600 range,929which at the time, it does not take a sharp pencil to figure930out that that is not sustainable, and we cannot be profitable931at those levels.932    Then when we look at phosphates, so MAP, $435 a ton in9332020, and it jumped to $1,100 a ton in 2022, and it has stayed934consistently high. It came off that high of 2022, but stayed in935the $700 to $800 range consistently for the last four to five936years. That has changed, and we apply less because of it.937Actually, in 2025, we did not apply any phosphate on our farm938because it just did not make economic sense for us. We are939taking the risk that, hopefully, in the coming years, it will940get cheaper, and we can catch up.941    We have dealt with this for a long time, and then when we942have world events that happen, that completely blows that up943and really exacerbates the problem. We feel it. This has been a944longstanding problem for us.945    Senator Thune. It predates current events, but946nevertheless, I mean, this is contributing. This is something947that is going back a long ways, and there are some structural948things I think here that need to be addressed, which is why we949have some of these transparency bills.950    Could you just very quickly share your experience with the951recent shortages, in particular the shortage of nitrogen in952South Dakota?953    Mr. Kubik. I will be honest, Senator, we have not954experienced a shortage of nitrogen yet. For our spring needs,955the nitrogen fertilizer has been there. A lot of this stuff was956in place and in country long before the events around the world957happened. They went up in price significantly, the product that958was here. We do have a product. We are starting to get959concerned about what do we in-crop, as our crop is growing and960needs more fertilizer, and as we look toward 2027. It is a real961consideration.962    Senator Thune. As we know, there are a small number of963manufacturers who have the lion's share of domestic fertilizer964production. I would like to ask this question of Mr.965Rosenbusch. In the United States, what percentage of sales for966potash, nitrogen, and phosphorus, respectively, to U.S.967retailers come from manufacturers other than the largest968companies?969    Mr. Rosenbusch. Thank you, Senator, for that question. Each970market is very different, so I will start with potash. Potash,971only about two percent of our domestic manufactured product,972represents the market here. When you look at nitrogen, again,973it depends on each of the different products. Ammonia, we have974a large percentage of U.S. domestic producers. We have 18975different companies that make up about 80 percent of that.976Then, when you get to phosphate, about 60 percent of our977domestic manufacturers represent the market share in the United978States. The other 40 percent is imported product.979    It depends on each of those, and when you think about the980total market for the United States, it is not just the domestic981produced product, but it is also the imported product that we982need to serve all the farmers' needs.983    Senator Thune. Mr. Chairman, my time has expired but if I984can I would like to submit a couple of questions for the985record.986    Chairman Boozman. Without objection.987    Senator Thune. Thank you.988    Chairman Boozman. Senator Klobuchar.989    Senator Klobuchar. Thank you very much, Mr. Chair. Mr.990Kubik, in March, Leader Thune and I introduced the bill I991mentioned that would create a mandatory price reporting system992for price transparency of fertilizer components. Could you talk993about how price transparency in the fertilizer market helps994farmers like yourself gain insight into the market and can make995informed financial decisions? How is it helpful during the996current market volatility we find ourselves in?997    Mr. Kubik. Thank you for that question, Senator, and it998would be huge. You know, we just want to understand this999market. Time and time again, I have found myself saying it, my1000neighbors saying it, that when the price of fertilizer is so1001high, we keep asking ourselves, why is it so high? You know1002what is going on now? This one little event, you know, a couple1003of months ago, it was easy to point to, but leading up to that,1004nobody knew that answer.1005    We just want transparency in that for (a) risk mitigation,1006so we can understand how we purchase our fertilizer, early when1007we do it, the trends, everything else, and just pull back some1008layers to see how our fertilizer, our main component, one of1009our main input components, is priced, and priced to us.1010    Senator Klobuchar. Thank you. Mr. Green, you spent some1011time during the last administration looking at competition1012challenges in fertilizer and other input markets. Can you talk1013quickly about some of your findings back then?1014    Mr. Green. Well, we did a request for information around1015fertilizer. I gather your question is focused on fertilizer. We1016did a lot of different things on seeds, on cattle, on poultry,1017but on fertilizer, we did a request for comments, and we did a1018summary of that. It was made available. We really found, this1019was in 2002, 2003, so many of the trends you are hearing today1020were entirely present then. These have been building up for a1021number of years, but they are small number of choices, high1022concentration, high prices, prices that follow the price of1023corn rather than the price of the supply and demand for the1024actual product itself, or supply and demand for the inputs into1025fertilizer itself. That really just raises questions. I mean,1026obviously, there are some reasons why it might be connected,1027but the extent of the connection is really a focus of concern.1028    We made all of that public, hundreds of comments, and we1029would certainly be happy to share that with your office.1030    Senator Klobuchar. Thank you. Thank you very much. Mr.1031Melton, you mentioned the war, and many of our farmers have1032found themselves stuck with higher costs right before the1033planting season, or during it actually, which was reflected in1034your Farm Bureau Fertilizer Survey. Fifty-eight percent of the1035respondents reported that their financial situation has1036worsened this year.1037    How are these costs going to affect the next generation of1038farmers that are trying to get started, that maybe do not have1039the margin or the savings of some of our farmers who have been1040around a while?1041    Mr. Melton. We have probably seen four years of balance1042sheet deterioration. We have had four years of where prices1043have declined, and basically all of our inputs have gone up,1044but especially fertilizer here.1045    It is concerning about the next generation, because they1046probably do not have the balance sheet strength that some of1047our mature farmers, I would say, and it is very concerning.1048Plus, actually talking a young person to getting into1049agriculture right now is concerning to me, because what would1050make you want to do this? I mean, when you are looking at not1051being able to make a profit, or basically not planting the1052crops that you normally plant because of fertilizer prices. We1053have to do something to try to stabilize this market and make1054us more profitable. There are a lot of different things that we1055can do----1056    Senator Klobuchar. Agreed.1057    Mr. Melton [continuing]. but we have to get farmers back to1058profitability again.1059    Senator Klobuchar. Agreed. Thank you. Quickly, Mr.1060Rosenbusch, can you talk more about the unique challenges1061fertilizer companies are facing with these supply chain1062disruptions? You mentioned some things internationally that I1063did not even know about, and I want to quickly get to Mr.1064Westling. If you could be fast. Thanks.1065    Mr. Rosenbusch. Yes, thank you, Senator Klobuchar. I think1066I would just summarize it by saying that we are competing as a1067free market in the United States with a significant amount of1068manufactured fertilizer in countries where you have state-1069controlled enterprises. I referenced China with almost half of1070the world's phosphates. When they decide to keep that all for1071domestic consumption, that is what is driving market trends1072more so than any other factor right now, is their internal1073government policies.1074    Senator Klobuchar. Thank you. Mr. Westling, thanks for1075being here. I mentioned Senator Marshall and I introduced the1076bill to create a grant and loan program at the USDA to help1077domestic fertilizer companies, getting at some of the concerns1078that your previous witness mentioned, like yours, to get into1079financing. What are the challenges in creating a novel1080fertilizer production facility like Project Meadowlark? Nice1081name, by the way.1082    Mr. Westling. Thank you, Senator, for the question. The1083biggest challenges on projects that get to a certain scale are1084the upfront capital requirements, and in this industry, in1085particular, since so few of them built, as I alluded to in my1086testimony, there is a real lack of expertise around it. In the1087case of our project, for example, we will have spent $50 to1088$100 million before we sign some of the major contracts for1089construction. That upfront capital cost to bridge to the point1090where you have got the certainty to be able to execute and give1091certainty to other investors and lenders, I would say is the1092biggest challenge, for sure.1093    Senator Klobuchar. Thank you very much.1094    Chairman Boozman. Senator Marshall.1095    Senator Marshall. Thank you so much, Chairman and Ranking1096Member, for your leadership in this, as well.1097    Thanks to the Working Family Tax Cuts Law, crop insurance1098and reference prices have been taken care of, for the most1099part. Now, input costs are the number one issue concerning1100American farmers. In fact, fertilizer costs now account for up1101to 40 percent of input costs. That is now the number one issue,1102these input costs. American farmers are price-takers on both1103ends, paying monopoly prices for inputs. They must buy and1104accept commodity prices they cannot control. With no pricing1105power on either side, that is not a market. It is a trap for1106the American farmers.1107    I do point out that prices for fertilizer were higher for1108some 18 months when Russia invaded Ukraine, and those prices1109came down. Of course, now they are up significantly.1110    We will speak to Mr. Rosenbusch first. As you know, one1111particular company controls 64 percent of U.S. phosphate rock1112mined, may account for 90 percent of retail sales to farmers.1113It is being reported that this largest domestic supplier of1114phosphate is closing plants, which will reduce domestic1115supplies, while we have a 16 percent duty on Moroccan imports1116on phosphate.1117    I guess the other question I would ask you, what are these1118countervailing duties protecting? Aren't farmers not getting1119squeezed from both sides with less domestic supply and1120restricted imports?1121    Mr. Rosenbusch. Yes, thank you, Senator Marshall, for that1122question, and really, an interesting topic that I think is1123going to be the hot topic going forward into the future. I1124cannot speak for specific company's business decisions, and as1125you are aware, those are companies that are all TFI members on1126opposite sides of that case. We remain neutral when it comes to1127that specific case.1128    Senator Marshall. I am not asking you to comment on their1129plan, but I think you would agree with me that the farmers are1130getting squeezed on both sides now, less domestic supply and1131restricted imports. Does The Fertilizer Institute support free1132market competition and fertilizer pricing? Yes or no. If the1133answer is yes, you have to justify the duties that block the1134world's largest phosphate producer from competing for American1135farmers' business.1136    Mr. Rosenbusch. There is no question, Senator, that farmers1137are going through a really difficult economic time, and TFI1138does support policies that promote open, fair, predictable, and1139transparent trading environment. I think when we think about1140phosphate going forward, those two raw materials, to1141manufacture that, are sulfuric acid and ammonia. With the1142sulfur challenges we are now----1143    Senator Marshall. We understand all that. We understand1144there is a shortage of sulfur. We need the sulfur to mine the1145phosphate. That is pretty elementary chemistry. I am just going1146to ask you directly. Does The Fertilizer Institute support or1147oppose removing the 16 percent countervailing duties on1148Moroccan phosphate? The farmers in Kansas deserve an answer.1149    Mr. Rosenbusch. Senator, I understand how challenging that1150is for farmers because we have member companies that are on1151both sides of that case. We do not take a position on that1152particular case at the ITC right now.1153    Senator Marshall. The American farmers paid almost $71154billion in excess costs over five years because of that 161155percent countervailing duty. Does The Fertilizer Institute1156believe American farmers should pay above market prices to1157protect a single company's market position?1158    Mr. Rosenbusch. Senator, we definitely believe that farmers1159need access, and TFI member companies are committed to ensuring1160they have supply, and that that supply is in line with what1161global markets are. In many cases we have seen that the U.S.1162market is actually traded at a bit of a discount right now,1163almost $150 cheaper than what Brazil pays for their phosphates.1164That commitment that I think the U.S. fertilizer suppliers have1165is to the farmer, to get an affordable and abundant supply of--1166--1167    Senator Marshall. Mr. Rosenbusch, would you agree that the1168American farmers deserve access to the lowest cost, highest1169quality fertilizers available, regardless of where it is1170produced?1171    Mr. Rosenbusch. Thank you, Senator. We 100 percent agree1172that fertilizer manufactured and bolstering domestic supply of1173fertilizer is incredibly important to deliver to U.S. growers1174the fertilizer they need in order to be profitable.1175    Senator Marshall. I just want to reiterate that the number1176one challenge for the American farmer today is input costs, and1177fertilizers now account for up to 40 percent of those input1178costs. Look, trade exports are up. We went from 2.3 to 2.81179billion bushels of corn last year. We are going to have a 201180percent increase in corn and ethanol exports again this year.1181The problem are the input costs, and the fertilizer is the1182biggest chunk of those that we need to address. I appreciate1183again the Chairman and Ranking Member for giving us this1184opportunity to discuss these. We have been working on these,1185again, since Russia invaded Ukraine, and we need to give the1186American farmers some relief now. Getting rid of those1187countervailing duties would be the quickest, most immediate1188impact that the American farmer could see in their real world1189today.1190    Thank you, Mr. Chairman.1191    Chairman Boozman. Thank you. Senator Smith.1192    Senator Smith. Thank you, Mr. Chair and Ranking Member, and1193thanks to all of our panelists today. I want to actually maybe1194follow up a little bit on Senator Marshall's questions, because1195I think he is touching on something that everyone on this1196Committee cares about.1197    You have got these skyrocketing input costs, and we also1198have what we know to be really significant market1199concentration, and on the input side we are talking about1200fertilizer today. I think, actually, Mr. Kubik, you put it1201really clearly. You said basically the fertilizer companies1202raise their prices because they can. That is the market power1203that they have.1204    You know, I was just looking at some data, which gets at1205this, and I am going to just come to you first, Mr. Kubik,1206because I think this is really interesting. This data is a few1207years old, so it is maybe prices that were in global markets1208were more affected by what is going on in Ukraine, but I would1209ask everyone, do we really think it is different now than it1210was? This is from the Institute for Ag and Trade Policy in1211Minnesota.1212    They said that in the 2021-2022 time period the nine1213largest fertilizer companies made an estimated $84 billion in1214profits. In 2022, major fertilizer companies saw profits1215increase by somewhere between 100 and 200 percent. Their input1216costs did not go up by that much.1217    Think about that, Mr. Kubik. Their profits are going up1218between 100 and 200 percent. How much do you think the profits1219of the average farmer in South Dakota was going up during that1220time period?1221    Mr. Kubik. Thank you for that question, Senator, and1222bringing light to it. I can tell you personally----1223    Senator Smith. Yes.1224    Mr. Kubik [continuing]. they have not gone up by 100 or 2001225percent. That is why we struggle with it. I look at my cost of1226production. When I look at marketing my corn or my soybeans or1227my cattle, and that is how I determine my marketing points.1228That is why we kind of feel taken advantage of. They can look1229at their cost of production and throw it out the window and1230just look at a price to set it at.1231    Senator Smith. Yes, that is the price that they can charge1232because, as you said, they have the market power. Mosaic's1233profits in that time period went up 120 percent. Nutrien's1234profits went up 142 percent. I mean, that looks like excess1235profit to me. Did you want to add?1236    Mr. Kubik. If I may. I believe that there is a copy of the1237article at all of your desks. This is not just two, three and1238four years ago. This is like in the last week we have similar1239reports of massive profits. That is the thing that we feel the1240worst about, is during this last 75 days a lot of money was1241being made, but it was not by farmers.1242    Senator Smith. I always say when I am talking to Minnesota1243farmers there is plenty of money in agriculture. The question1244is who is getting it. It is not farmers right now.1245    Now, I am fully in support of the excellent transparency1246bills that have been put forth, bipartisan by my colleagues. I1247am wondering, Mr. Melton or Mr. Kubik, or anybody who wants to1248comment, do you think that those transparency laws, if they1249were in place right now, do you think that would change the1250behavior of these companies? Because that is what we are1251talking about. We are talking about the behavior that they have1252of being able to raise prices so exorbitantly.1253    Mr. Melton. Well, thank you, Senator. I think we need all1254the tools in the toolbox that we can use, anything that we can1255do to help us get back to profitability. I go back to we have1256seen four years of decline in our balance sheets. This cannot1257continue on. You cannot keep losing money and continue with the1258things that we are doing. I think we need every tool in the1259toolbox that we can use. I think transparency in markets will1260give us one tool there that we can use.1261    What we do right now, and I talked to my partner this1262morning about it, we get a lot of our information from the1263retailer. That is where we get our information on fertilizer1264right now. I mean, there are things on the internet you can go1265look to, but actual fertilizer pricing----1266    Senator Smith. To be able to actually see.1267    Mr. Melton [continuing]. we have to go to the retailer1268right now to see where we can price that fertilizer. I think it1269would be a good tool in the toolbox.1270    Senator Smith. Mr. Green, would you like to comment on this1271issue that I raised about the exorbitant profits that we are1272seeing? I know you work a lot on the question of how we can1273have fair markets in agriculture to the benefit of the folks1274that are actually growing things.1275    Mr. Green. I mean, I want to agree with my colleagues here.1276You need a lot of toolkits. There is no one toolkit that will1277bring those down. When you do have those supernormal profits,1278you need to go back and look at the mergers and look at the1279other conduct and bring enforcement cases. You have to think1280about the transparency toolkit. You have to think about the1281investment toolkit of supporting the new competition, the new1282choices, which is what we did in the previous administration,1283$778 million of investments.1284    Every single one of those is part of bringing down those1285supernormal profits, which are an indication of a broken1286market.1287    Senator Smith. That is exactly right. I agree with that1288completely. I know my time is up, Mr. Chair. I think the1289question is, what can we do to change the behavior of companies1290that are in a position where they can charge such high prices1291and get such exorbitant profits? I mean, in some sectors we1292look at things, I know it would be radical, but things like a1293windfall profits tax, something to change the behavior so that1294we can make the market more fair, particularly for the folks1295that are doing the work. Thank you.1296    Chairman Boozman. Thank you. Senator Grassley.1297    Senator Grassley. Before I ask Mr. Kubik the first1298question, I want people to know that there is at least one1299other Senator who agrees with the questioning that Senator1300Marshall put forward. In 2021, countervailing duties were first1301applied to Moroccan phosphate. A study published at Texas A&M1302in January found that farmers paid nearly $7 billion in1303additional costs between 2021 and 2025 growing seasons because1304of countervailing duties. One company, Mosaic, has 80 percent1305of the market in the United States, yet they feel like they1306need protection from 18 percent tariffs on Moroccan phosphate1307coming into this country.1308    Trump has tried to help with dollars from the U.S.1309Treasury, but what I hear, even last week, in 12 different1310counties in Iowa that I toured, farmers want to get their money1311from the marketplace, not from the U.S. Treasury.1312    I think this administration ought to get rid of that 181313percent tariff on Morocco phosphate. Lowering production costs1314would be as much help as increasing prices for farmers or1315getting money for the Federal Treasury.1316    Now, Mr. Kubik, for many years now, farmers have felt that1317when commodity prices increase, input prices are bound to1318increase with them. Since 2020, even as the price of corn has1319decreased, fertilizer prices have remained elevated. We know1320the talking points of the fertilizer industry. The cause would1321be Ukraine, Chinese export controls on fertilizers, all1322contributing to prices farmers are facing and increased prices1323those are. However, farmers have also been seeing increased1324consolidation of the fertilizer industry. Farmers want to know1325exactly why they are paying the price that they have for1326fertilizers, and I think we need more transparency on that.1327    For you, Mr. Kubik, as a consumer of fertilizer, how much1328insight do you have into the price of the fertilizer you use?1329    Mr. Kubik. Yes, thank you for the question, Senator, and I1330will echo what Eddie said. We get a lot of that from our1331retailer, and our retailer gets a lot of that from the1332wholesaler, and we are just kind of going off of things we hear1333in the news and then coming to them. We are still big on the1334fertilizer transparency, the Fertilizer Research Act that you1335introduced. We just need to see more data and see more trends.1336    We like to typically purchase our fertilizer in the summer1337prior to the growing season, so this summer, a lot of farmers1338will be purchasing fertilizer in June and July for the next1339growing season. Now we have a lot of uncertainty. Is that trend1340going to remain the same? We just do not have a lot of that1341data to look at.1342    If we can just see a lot more of that. Even if it is too1343high and we think it is too high, at least we know how and why,1344and predict a little more what it is going to do.1345    Senator Grassley. My second question, I think you just1346addressed, but more transparency, and knowledge, and data on1347fertilizer prices would be very beneficial to you.1348    Mr. Kubik. It would be huge, yes. As one piece that was1349mentioned before, it is one piece of the puzzle trying to1350figure out this market.1351    Senator Grassley. Yes. Maybe this next question is1352difficult for you to answer, but is there any reason you can1353think of that the fertilizer industry may not want a study to1354be published by the U.S. Department of Agriculture?1355    Mr. Kubik. Not one that I can think of, and I actually1356heard comments today they are very supportive of transparency,1357which is nice to hear that they support that. It sounds like,1358well, you know, with their support and our support, hopefully1359we can get these bills across the finish line and start getting1360and collecting this data.1361    Senator Grassley. Mr. Rosenbusch, does The Fertilizer1362Institute support a report that provides insight to farmers on1363why they have paid certain prices for fertilizers, including1364factors such as market concentration?1365    Mr. Rosenbusch. Senator Grassley, thank you for that1366question. Good to see you again. We had some of these1367conversations a few months ago when you chaired the Committee.1368Yes, we do support transparency. We think farmers need more1369information to understand markets and prices, and we believe1370that USDA can play a very important role in being able to1371explain that.1372    I was at a farm on Friday, talking to some growers about1373the dynamics, the global dynamics, what was creating the price1374structure we have today, and they were very appreciative of1375that. I am one person, and I think the more we can do to invest1376in providing that market information, the better it will be for1377growers to make those decisions.1378    Senator Grassley. My time is up, Mr. Chairman. I will put1379the rest of my questions for answers in writing.1380    Chairman Boozman. Thank you, Senator Grassley. Senator1381Lujan.1382    Senator Lujan. Thank you, Mr. Chairman. Thank you and the1383Ranking Member for calling this hearing. To all the panelists,1384thank you all for being here.1385    Last week, I had the opportunity to sit down with some1386farmers and ranchers in southern New Mexico and just ask them1387what is working, what is not working, what is happening to your1388bottom lines. A host of issues they shared with me--increased1389farm input costs, shortage of farm labor, concern with an aging1390farming population, loss of expertise at USDA. Someone said1391that it is hindering their ability to get timely assistance1392from the United States Department of Agriculture.1393    Now, many of the issues are larger than one administration.1394I recognize that. However, some of the issues can be directly1395attributed to policies advanced by this President and by this1396Administration. President Trump began by implementing sweeping1397tariffs that have closed off entire markets to American1398farmers, markets, and relationships that we spent decades1399building, driving down prices just as farmers across the1400country are headed to the field to harvest their crops.1401    President Trump then started a war in Iran, I would argue1402an illegal war, without seeking congressional approval. As a1403result, the Strait of Hormuz is now closed, which has caused1404fertilizer prices around the world to skyrocket. While all of1405this was happening, President Trump's Department of Agriculture1406implemented sweeping reduction-in-force efforts. It is hard to1407find inspectors anymore to go in, if you are able to get1408approval or a stamp to sell your stuff, and we cannot seem to1409agree that empower colleges across the country that are ag1410institutions, that when there is not a USDA inspector available1411there should be someone from the state available, whether they1412are going to look at crop yields or they are going to look at1413what is happening with drought for insurance. We are just going1414to get a stamp so that they can sell their products. I really1415do not understand that.1416    With the loss in institutional knowledge and talent at the1417agency, it creates more of a backlog, on top of all the1418pressures that I was just sharing.1419    Mr. Rosenbusch, I guess a yes-or-no question. Let me just1420start with this one. Yes or no, is President Trump's war in1421Iran directly related to the spike in fertilizer prices we have1422seen since February 2026?1423    Mr. Rosenbusch. Senator, thank you for that question, and1424we have seen significant impact on the global fertilizer1425markets because of the events in Iran. There are many, many1426factors right now that are at play on a global scale that are1427really driving what these markets are, whether that be what1428India is doing with their purchasing power right now or what1429China is doing to restrict exports.1430    Senator Lujan. I am not a lawyer, but is that a yes?1431    Mr. Rosenbusch. Senator, I----1432    Senator Lujan. If you are not going to say yes or no, I1433will just point to the first bullet on your filed testimony.1434The answer is yes, and you justify it on the first bullet on1435page 10 of your testimony. It is not a gotcha question.1436    What is harder on Congress these days is stipulating to a1437set of facts. You bring yours, I bring mine, and then we fight1438about them, and there are no facts. What this war in Iran is1439doing to the cost of fertilizer is bullshit. Maybe we should1440just be talking about the kind of fertilizer that comes out of1441cows and sheep. Maybe we should be using some more of that in1442America. Figure it out.1443    You all do not come in here and tell me that the people1444back home are full of shit. I do not understand that, man. The1445cost is the cost. Implements are more expensive because of1446tariffs. I am not going to ask the Republican witnesses that1447because I am going to get some academic justification on why it1448is just my imagination. When I went to put in diesel this week,1449I guess it was just my imagination that I was paying over $5.501450a gallon. I am one of the few Senators here that probably puts1451diesel in a truck and a tractor.1452    I have a lot of questions to file, Mr. Chairman. I am sorry1453I got distracted here. We just want a straight answer, man.1454Farmers and ranchers across the country are hurting. You know1455this. Whether it is a Democrat or a Republican, whenever an1456administration is doing something that is punitive to the folks1457that we have a responsibility to fight for, then let's speak1458up. I will call out Dem Presidents the same way I am going to1459call out a Republican President.1460    I grew up as a self-sustenance farmer. I did not know we1461were poor when I was growing up because we always had good1462food. We had lamb chops, fresh chile, tomatoes, and apples.1463Sometimes Mom even made an apple pie. I am still one of the1464Senators that shakes the milk when I buy it, because we had1465milk delivered when I was a kid, and it is the way that you got1466the cream from the top into the rest of the milk. My buddies1467laugh at me, and they say what the hell am I doing.1468    I am sorry for vernacular that I am using, Mr. Chairman,1469but sometimes when you grow up on a little farm, and you have1470to shovel shit in the morning to keep the barns clean, we need1471to talk that way over here so we can connect. We can do better1472here, and I certainly hope that we can get a farm bill, that we1473can work together, that we do not let basic arithmetic get in1474the way of what it means, because it takes 60 votes to get it1475done. Let's work together to get things done here.1476    All that I would ask for the panelists, whether we meet1477individually or not, let's just be straight with each other,1478you all. We do not need to sugarcoat stuff. People are hurting1479today. Let's recognize that, and then let's agree to find some1480solutions to make things better.1481    Thank you for the indulgence.1482    Chairman Boozman. Thank you. Senator Fischer.1483    Senator Fischer. Thank you, Mr. Chairman. Mr. Westling, can1484you take just a minute to discuss the project that you are1485doing in Gothenburg and maybe highlight some of the challenges1486that you face.1487    Mr. Westling. Yes. Thank you, Senator Fischer, for the1488question. The project that we are doing is to make a fertilizer1489type that is utilized in that region or geography in the State1490of Nebraska, born from the shortage that exists there and the1491difficulty of transporting product there over sometimes huge1492distances.1493    In terms of the challenges faced, like every large project1494that is not done by an incumbent or somebody with a big balance1495sheet it is upfront capital and raising capital to get those1496projects off the ground. I am fortunate and thankful for the1497mostly farmers who stepped up to the plate to fund this project1498and/or to fund the early stages of the project.1499    Senator Fischer. You know, we are hearing some discussions1500around federal investments. What types of safeguards do you1501believe should be put into place to ensure that new1502infrastructure projects that happen, that they are not going to1503be resold, which Senator McConnell talked about that he was1504able to work on, or contribute to consolidation, which is what1505I hear from producers. I am sure you do out in the western part1506of the state, too, hear from producers. They are worried about1507that consolidation and what it does to price. Do you have any1508thoughts on that?1509    Mr. Westling. Senator Fischer, I am certainly not an1510attorney and I will not pretend to know how to write bills. I1511will leave that to all of you, much smarter than I am. I would1512like to think that there is a way, through whatever form1513potential assistance comes in, for you to be able to create1514those exclusions or prohibitions from trading or consolidating1515or putting these types of projects in the hands of whomever you1516do not wish for them to be in.1517    Senator Fischer. Do you worry about regulations, federal1518regulations, local regulations? Have you had to deal with any1519of that?1520    Mr. Westling. Senator Fischer, we have had some regulations1521that we have had to deal with, not any different from most1522projects of this scale. We have been relatively fortunate in1523that in our state, the folks who are in charge of administering1524those regulations or enforcing those regulations have all been1525very reasonable to work with. To the extent at the federal1526level where we needed them to weigh in, again, blessed by the1527fact that those folks have all been very reasonable to work1528with, as well.1529    Senator Fischer. That is good to hear. Thank you.1530    Mr. Rosenbusch, as many of my colleagues have shared,1531fertilizer availability and the prices are the forefront of1532every farmer's mind across the country, and that includes my1533friends in Nebraska. For years the United States has been1534reliant on foreign fertilizer production to meet that domestic1535demand. With a lot of talk around the need to increase that1536domestic production, can you share the current regulatory1537challenges existing companies face when they tried to onboard a1538new fertilizer facility in the U.S.?1539    Mr. Rosenbusch. Thanks, Senator, for that question. Josh1540did an outstanding job of explaining that.1541    Senator Fischer. Do you feel that it is pretty good to be1542able to deal with?1543    Mr. Rosenbusch. It is really hard to build new capacity in1544this country. One recent ammonia plant took seven years to1545permit and over $25 million, just to permit it, not even to1546start construction. We are talking $4 to $5 billion dollars of1547capital. A phosphate mine took over a decade and $32 million1548just to permit. That is all about the federal permitting1549process across multiple agencies. When you think about actual1550production itself, once you get into production, the regulatory1551challenges that add the cost to manufacturing, you have got1552phosphogypsum, which is a byproduct of phosphate fertilizer1553that has to be stacked and costs over $1 billion a year just to1554maintain those stacks.1555    There are a long list of regulations that we would be happy1556to share with you, of things that can be done to help bolster1557domestic supply.1558    Senator Fischer. Thank you. Mr. Kubik, so nice to see you1559here. Can you take a minute to discuss the role that precision1560agriculture has, that new technology that is out there, and the1561increased approval we are seeing in the bio-based products that1562they can have in providing additional options to growers, to ag1563producers, that are faced with the uncertainty they have now1564with fertilizer.1565    Mr. Kubik. Yes, thank you, Senator, for that question. This1566is something I am very, very passionate about.1567    Senator Fischer. Me too.1568    Mr. Kubik. Yes, coming out of college with an agronomy1569degree and always looking to better ourselves. I think that1570could be said for all farmers. We are all trying to do what is1571best for the land because we want our kids and our grandkids to1572farm on that land. This fertilizer costs a lot, so we cannot1573just throw it on and waste it and kind of hope it got there1574right.1575    We are very precisely applying it. We are variable rate1576applying it, so parts of the field are getting more than1577others, based on our soil testing, to make sure we are doing1578everything exactly like we should.1579    The biological space has definitely garnered a lot of1580attention over the past couple of years with the increase in1581fertilizer. I will be trying a couple of different ones on my1582farm. I have tested multiple different ones on our farm. The1583problem with that, unfortunately, though, Senator, we live in1584reality, and there are not enough right now to rely on. We1585still need fertilizer to grow our crops, and we are hopeful. I1586dream of a day where I do not need commercial fertilizer1587anymore. That would be the best thing ever. I do not know if my1588grandkids will experience that. If we can put on less, put it1589on accurately, I think it does good for both sides.1590    Senator Fischer. Thank you. Thank you, Mr. Chairman.1591    Chairman Boozman. Thank you. Senator Warnock.1592    Senator Warnock. Thank you very much, Brother Chair.1593Brother Chair, I'm sure you know that the top state for farm1594bankruptcies last year was your home State of Arkansas. The1595number two state was Georgia, so we are dealing with this same1596issue. I am sure the Chair and I agree that while we like to1597see our states leading, we do not want to be leading in this1598way.1599    In fact, farm bankruptcies increased by 46 percent last1600year, due largely to the President's trade war, and I wonder1601how many more farmers may go bankrupt by the end of this year1602because of President Trump's war in Iran, a war that is raising1603fertilizer and fuel costs, as we all know, due to the closure1604of the Strait of Hormuz, which anyone paying attention could1605have predicted.1606    Mr. Rosenbusch, the President's war in Iran has further1607increased fertilizer prices for farmers in the United States.1608You are the CEO of The Fertilizer Institute, the trade1609association representing the companies that provide farmers1610with fertilizer. Has the White House presented you with a1611viable plan for bringing down fertilizer prices this year?1612    Mr. Rosenbusch. Senator, thank you for that question, and1613we have been very engaged with discussions on Capitol Hill,1614with the Administration, on really an all-government approach1615to solutions to help mitigate the impacts of the closure of the1616Strait, what we can do to prioritize domestic supply, what we1617can do to incentivize projects like Josh's, to bolster more1618domestic supply, so these supply shocks will not hurt the1619farmer in the future when we are so reliant on some of these1620foreign supply sources around the world.1621    Senator Warnock. Do you expect fertilizer prices to go down1622this year?1623    Mr. Rosenbusch. Senator, that is a really interesting1624question. I do not know that I can comment or legally predict1625what is going to happen to the price of fertilizer. I will tell1626you that we are very concerned about particularly phosphate,1627with a $1,000-plus sulfur right now due to the restriction of1628sulfur coming through the Strait. We are now at a point where1629sulfur costs alone are significantly higher than the cost of1630phosphate. You have seen around the world right now phosphate1631mines around the world starting to curtail production because1632of some of that price impact.1633    Senator Warnock. Same question for the rest of the panel.1634Has anyone seen a viable plan from the White House that gives1635them confidence that fertilizer prices will decrease in the1636near term? No takers. Fertilizer prices are increasing. Diesel1637costs have also increased by over $2 a gallon compared to this1638time last year, and there is no end in sight.1639    Mr. Melton, you are the President of the Kentucky Farm1640Bureau, so you know farmers in the South typically do not pre-1641purchase their fertilizer and are more subject to price1642volatility. What are you hearing from your members? Are they1643able to afford fertilizer this planting season?1644    Mr. Melton. In Kentucky we got an early start this year,1645and most of the crop has already been planted this year in1646Kentucky, Senator. I can tell you that, and especially on our1647farm, we did more intensive soil testing and applying1648fertilizer where we had to, without trying to reduce yields. I1649think that is across the South. I think a lot of people are1650doing those things, trying to get more creative to where we can1651try to pencil out a profit with where current prices are for1652our commodities.1653    Senator Warnock. People are feeling the affordability1654pinch, obviously, right?1655    Mr. Melton. People are cutting back usage on fertilizer on1656their farms. Yes, sir.1657    Senator Warnock. Dealing with the uncertainty as best they1658can. This uncertainty hits farmers at the worst possible time,1659planting season. It is not a good time to be dealing with this.1660I am not hearing from anyone here that the White House has a1661plan that will solve this crisis for farmers. Dialogue is one1662thing. A plan is another. At this point, the best-case scenario1663for farmers is the reopening of the Strait of Hormuz, which was1664opened before the war started. Even then, the fertilizer market1665will not bounce back overnight if it were to open tomorrow. You1666will still be dealing with these prices.1667    Between the war in Iran, spiking fuel and fertilizer1668prices, and the illegal trade wars increasing the cost of1669equipment and limiting market access, it is no wonder that1670farmers in Georgia I talk to say that they cannot take much1671more, and we are dealing with this farm foreclosure crisis. As1672a Member of this Committee, I will continue to fight for1673farmers and doing everything I can to end this illegal war in1674Iran and unfreeze our fertilizer and fuel markets.1675    Thank you very much to the panelists. Thank you, Mr. Chair.1676    Chairman Boozman. Thank you. Senator Hoeven.1677    Senator Hoeven. Recently, I had an opportunity to get1678together with Secretary Rollins as well as our Chairman,1679Senator Boozman, and talk about both short-term and long-term1680efforts to reduce fertilizer prices. One of the ways we are1681doing that is with precision agriculture. As a matter of fact,1682Brian Carroll is here with us today from Grand Farm, in the1683audience, along with Greg Tavine. Grand Farm in North Dakota1684was recently named as the manager for the National Proving1685Grounds and the actual first proving ground, or test site, for1686ag technology to develop precision ag in a way that helps us1687actually accomplish the same by using less inputs, meaning less1688chemical, less fertilizer for our crops.1689    That is exactly the kind of work Grand Farm is doing in1690conjunction with ARS, and North Dakota State University, and1691NIFA funding. That has an impact both in the short term and the1692long term because basically you get the same result with less1693fertilizer. I would like to hear from both Mr. Kubik and Mr.1694Melton on how that can make a difference for farmers and what1695kind of things need to happen so that farmers can utilize that1696technology both now and in the future. Starting with you, Mr.1697Kubik.1698    Mr. Kubik. Thank you, Senator, for that question. I think1699in terms of what we can do, a lot of farmers are already using1700it, especially in fertilizer application. Many of us get our1701fertilizer applied by our retailer, and those retailers are1702using state-of-the-art machines, they are using, again, like I1703said, variable rate technology, and it is all a goal of ours to1704use less fertilizer, or to maximize the efficiency of our1705fertilizer use, something my farm did last year, where we1706learned that with a little bit of rain we can lower the amount1707of nitrogen we need to grow a bushel of corn. I think that is1708key.1709    I do not know if we are necessarily using, on whole, a lot1710less nitrogen. We are just more precisely placing it where it1711needs to be. Ultimately, that is our goal, and a lot of that1712equipment, precision technology, is in the field today.1713    Senator Hoeven. Mr. Melton?1714    Mr. Melton. Thank you, Senator. I think research and1715development is probably one thing, and you brought up your1716university. I think our university does an outstanding job of1717doing research on projects, like they are talking about in your1718state. I think that we have to continue to do research and1719development into these technologies, and while I am thankful1720that I have some younger folks on my farm that can help apply1721these technologies, because some days I have trouble starting a1722tractor sometimes now. I am thankful that we do have the1723research and development from the universities and the land1724grants that can do these projects and work on technologies that1725can be brought to us, to where we can get more efficient into1726the future.1727    Senator Hoeven. Yes. Well, Mr. Melton, you may have a1728little trouble with some new technology, but they like the fact1729that your labor, and they probably do not have to pay too much1730for it. I am guessing you volunteer.1731    Mr. Melton. No, I do not volunteer, but they do tell me1732sometimes when I am there, I think some of the jobs I get are1733not the most prestigious jobs anymore. Yes, it is good to do1734it.1735    Senator Hoeven. Mr. Westling, in North Dakota, we also have1736the Dakota Degasification Company that now takes coal, converts1737it to natural gas, and then converts it to fertilizers like1738ammonia and urea. How do we get more of that going so we get1739our fertilizer here at home, and we have more competition and1740lower prices rather than getting it from Indonesia or Russia or1741someplace where it is high-priced and a lot of transportation1742costs?1743    Mr. Westling. Yes. I think the question was asked earlier1744about the plan from whomever, be it the White House, the USDA,1745or whichever agency wants to take it on. Maybe I am just1746simple, but I think the plan, in my brain, is if the demand is1747going to be there, and it is, increasing supply, right, because1748that should lower the costs.1749    Senator Hoeven. Demand is there.1750    Mr. Westling. Demand is there. I think some of the ideas1751that I alluded to earlier with incentivizing these projects on1752the front end of this process, helping bring capital, to bring1753additional certainty, certainly when the government leans in,1754everybody else leans in too. Those types of things could and1755should incentivize folks to build more of these projects, no1756doubt.1757    Senator Hoeven. You would agree we need to do more of it.1758    Mr. Westling. I absolutely agree we need more of them. The1759farmers have invested in my project do, as well.1760    Senator Hoeven. We appreciate your project, as well, in1761Nebraska. Mr. Rosenbusch, what do we do in the short term to1762get more competition and fertilizer prices down?1763    Mr. Rosenbusch. Thank you, Senator, and it is an excellent1764question. It is really difficult right now when you have got1765countries all over the world that are driving up the price by1766subsidizing and paying high prices. I do agree with Mr.1767Westling, the Administration has done some things to1768incentivize bolstering domestic supply, and we need that,1769whether it is permitting reform. Some of the equipment that is1770required to build plants, such as his in Nebraska, has to be1771imported, so there are currently tariffs on some of those1772pieces of equipment that have to come in, driving up the cost1773of construction. Then the little things like hours of service1774exemptions, to make sure that we can get fertilizer delivered,1775prioritizing fertilizer for domestic supply, which is also on1776the back of delaying some of the plant turnarounds, to make1777sure we are optimizing supply coming out of the existing1778plants.1779    Senator Hoeven. Thank you.1780    Chairman Boozman. Senator Welch.1781    Senator Welch. Thank you very much for this excellent1782hearing. I just want to compliment the witnesses. It is very1783instructive, and I appreciate the information you are providing1784to us.1785    We are in a crisis in American agriculture. There is an1786immense amount of wealth that is being created by the farmers.1787They are just not getting any. Let me just illustrate that1788point by a report from our Department. The average loss for1789rice is $220 an acre, for cotton, $202 an acre, for oat, $1591790an acre, for peanuts, $131 an acre, for sorghum, $91 an acre,1791for corn, $87 an acre. This is not sustainable.1792    Doing some of the things that Governor Hoeven was talking1793about, precision agriculture, things that are within the1794control of the farmers, they are doing that every single day1795and figuring out ways to do it. If we have this inability to do1796any control over what the input costs are, and they march up,1797step by step, as the price of corn goes up or the price of oats1798goes up, the farmer is totally at the mercy of a market that is1799consolidated.1800    Mr. Kubik, you talked about consolidation, and I was1801impressed, with all of you, really, how long and how specific1802you are. That is an issue that we have got to deal with. You1803can deal with precision agriculture and try to figure out the1804best practices, and you have got your own incentive to spend as1805little as possible. What about consolidation, where it would1806take some federal action to deal with the impact of1807consolidation? You see that as a real impact on your pricing,1808right?1809    Mr. Kubik. Yes. Thank you for that question, Senator, and1810100 percent, and that is one thing I wanted to emphasize, is1811that the Federal Government is the one that has the ability to1812go in and look at this. We do not as the South Dakota Corn1813Growers Association. We do not as individual states. I think1814the Federal Government has the most power.1815    Senator Welch. Do you see that as beneficial to farmers,1816and it does not matter whether they are Republican farmers, or1817Democratic farmers, or independent farmers. They like to do the1818work they do. That is what they are about, right?1819    Mr. Kubik. Correct. All we ask for is just to purchase our1820inputs in a competitive market.1821    Senator Welch. All right. What about transparency? Mr.1822Chairman, why don't we pass the Thune bill? I mean, the1823transparency seems to be something all of you believe,1824including you, Mr. Rosenbusch, that transparency is good. Does1825anybody have a problem with us moving out and passing the1826Thune-Klobuchar bill? All right, good. I would like us to do1827it, and like right away. We have got to help these guys.1828    Now, on small-scale farmers, it is really, really brutal,1829as well. We are seeing consolidation among farmers, as well,1830but that is not to drive profit. It is because of the smaller1831farmers cannot sustain themselves when they are losing this1832much per acre. Mr. Green, just talk to me about that. You know,1833I was on the Nitty Gritty Farm in Charlotte, Vermont, eighth1834generation, and they have got two kids, hoping for the ninth1835generation. By the way, all the farmers I know, they just love1836the idea of passing that farm on to their kids. Tell me about1837that issue.1838    Mr. Green. Well, the challenge is that a lot of farmers and1839ranchers face, whether it be farmers in your state or farmers1840in other places, is no matter how big they are, they are still1841much smaller than the processors and the retailers that are1842downstream from them. Their ability to negotiate fair prices is1843very limited. They are price takers. In fact, some of the1844processors themselves are price takers versus the retailers. We1845have got a system where the consumer is paying more, the farmer1846is getting less, and the folks in the middle are getting the1847benefits of all the hard work that are being done. That is1848where the focus needs to be.1849    Senator Welch. I want to go back. I believe the Iran war,1850it is not me believing it, it is incontestable that it has1851raised prices. Diesel is way up, and that is a big use on the1852farm. Fertilizer is way up. What I have heard from you is that1853has intensified what is a preexisting problem with the1854consolidation, the high prices, and the really tight margins1855that our farmers are facing. Is that correct?1856    Mr. Green. Yes. Absolutely, sir.1857    Senator Welch. All right. Well, I just want to thank you1858for your persistence and advocacy on behalf of the people that1859are close and near and dear to you. Rural America is really1860critical to the well-being of all of America, Mr. Chairman, and1861I think we have to act. This Congress has to act. You run a1862bipartisan Committee, and everything I have heard from this1863affects farmers, regardless of what their political affiliation1864is. I hope we move that Thune bill and Klobuchar bill, and I1865hope we do everything we can on consolidation and transparency.1866    Chairman Boozman. I hope we can act with this and several1867other things and get a farm bill passed.1868    Senator Welch. Thank you. Thank you all.1869    Chairman Boozman. Senator Moran.1870    Senator Moran. Chairman, thank you. Please know that I join1871you in your efforts to combine maybe a few things, but get a1872farm bill done. It is hugely important, and another opportunity1873for us to provide some certainty to our farmers at home.1874    Gentlemen, thank you for your testimony. I have been1875chairing my own subcommittee while this has been ongoing, but1876it is a hugely important issue. I have represented Kansas1877farmers and producers for a while. I see this as the most1878challenging time that my farmers in Kansas have faced since I1879have been a public official. It is, in part, due to five years1880of drought, that is not over yet, and so we begin the financial1881circumstances of most farmers at home in very difficult1882circumstances without the financial capability to weather1883another storm. I am very interested in trying to determine if1884there is a legislative fix to lots of market forces that go on1885that are bigger than just this one issue.1886    Mr. Rosenbusch, I read your testimony and noted that you1887talked about rural fertilizer and fertilizer components. There1888is a science that goes into understanding fertilizer, which1889this hearing has helped me better understand. It is not just1890one component. It is related to so many other items that are1891necessary. The closure of the Strait of Hormuz was probably not1892a circumstance that my farmers predicted, and as a significant1893result related, as I understood your testimony, to the world's1894sulfur supply, and 20 percent of the world's supply of1895liquified natural gas.1896    As sulfur is a key component of phosphate production, would1897it be fair to say that global phosphate access has been1898affected by the closure of the Strait? That is true, Mr.1899Rosenbusch?1900    Mr. Rosenbusch. Senator, thank you for that question. I1901appreciate your understanding of the complexity of the markets,1902which is one of the reasons why we support transparency,1903because it is really difficult to track all of these different1904commodities and the markets for them. Without a doubt, sulfur1905is a big issue right now. We have the spot market trading as1906much as $1,300 a metric ton, and a lot of that is getting1907bought by Chinese for mining. When you look at copper that1908might be $16,000 a metric ton to sell, that is where the free1909market is going to take a lot of that product, as opposed to1910into fertilizer production. This is going to continue to be a1911challenge going into the 2027 crop year.1912    It is a bit of a double-edged sword in that we need supply.1913We definitely support the idea of bringing more supply to the1914U.S. farmer. I was looking at some of the numbers. We have 1081915companies that supply nitrogen to the United States. We have 381916companies that supply phosphorus to the United States, 161917companies that supply potash. The double-edged sword is that1918you then expose yourself to some of these geopolitical events.1919We need to boost domestic production but also find1920opportunities to continue to find reliable global sources.1921    Senator Moran. One of the things that would be useful, I1922suppose, in theory, is a tariff to encourage domestic1923production, but a tariff also then increases the price of the1924inputs, and have we seen any increase in domestic production?1925    Mr. Rosenbusch. Yes, it is a difficult question, Senator. I1926appreciate you raising what is a very challenging topic,1927because long-term, when you start to put non-free market1928measures in place from a policy perspective, we understand that1929is going to actually have a worse consequence on supply for the1930United States. We saw that just with Venezuela recently, where1931we now have opened up that market, but that product is going to1932go to wherever the farmer is going to pay the most, which is1933Brazil right now. If we artificially impact the U.S. market, we1934are not going to be able to track supply here in the future.1935    Senator Moran. Why are we being outcompeted? Why is1936somebody else more capable of paying the higher price?1937    Mr. Rosenbusch. That is a good question, Senator. It is1938one, because you have foreign governments that are driving up1939the price of that through subsidies. I just heard recently1940Ethiopia is bidding for a very limited supply right now, and1941India is paying nearly $1,000 a metric ton that they subsidize1942to farmers. There is your floor price. That sets the global1943market price right there.1944    Senator Moran. While I focused a moment on tariffs, there1945is also this other distortion of moral markets in which foreign1946governments are subsidizing their farmers in a way that then1947disadvantages U.S. farmers.1948    Mr. Rosenbusch. That is going to attract global supply at1949that particular price to those foreign suppliers we need, as1950well.1951    Senator Moran. If the Strait was open tomorrow, what would1952happen?1953    Mr. Rosenbusch. Obviously, you are going to see an impact,1954and we need those vessels that are behind the Strait to come. I1955think it is going to take a while for that market to work1956itself out because, as I mentioned in my testimony, 40 plants1957there have been either curtailed because of no natural gas or1958they were hit by missiles or drones.1959    Senator Moran. I understand. Thank you all very much.1960    Chairman Boozman. Senator Justice.1961    Senator Justice. Well, you all waited a long time to hear1962from me, haven't you? You will find me to be this guy. I will1963be the guy with logic and reason, and I appreciate our Chairman1964like you cannot imagine. I appreciate all these great Committee1965Members right here, and they do a great job. They really do.1966    There is a real, real, real problem here, and I have heard1967lots and lots and lots of stuff from lots of people here just1968today, and they say things like, ``What do we do to get1969fertilizer prices down?'' Is the Iranian war killing farmers?1970Plenty of dollars in ag, but farmers are not getting those1971dollars.1972    You know, Trent Kubik says many things, but the one thing1973that absolutely just beams from him is he loves what he is1974doing, and he does not want to give it up.1975    You know, I started our farming operation in, well, 501976years ago, and we grew it. At one point in time we were the1977biggest cash grain farmers, I think, east of the Mississippi1978River. We were seven or eight times National Corn Growers--and,1979you know, Trent, I know you are in the National Corn Growers1980and everything--but we were seven or eight times National Corn1981Growers winners.1982    I know a lot about this. I really do know a lot about it. I1983am a business guy. You know, I have got an MBA, and I am a1984business guy, and I would tell you just this. You have a1985colossal problem, because you have got a lot of people here1986that would really like to help, but I do not know that they1987will. At the end of the day, you have got frustration, and to1988be perfectly honest, it is probably going to get worse.1989    We have to move. Mr. Chairman, you know, and I know too,1990that we have to move. We are losing folks every day, and the1991tragedy is beyond teetotal belief. You know, I think about1992Eddie Melton there, and I have known him forever and a day, at1993least known of him forever and a day, and now I am getting the1994opportunity to meet him and everything. Eddie, I would say to1995you just this. Did you ever know Ken Wells, Dr. Kenneth Wells,1996at the University of Kentucky? Dr. Kenneth Wells came to our1997operation when I was just a kid, and really basically I owe1998just almost everything I know about agriculture, and it is a1999boatful, to Kenneth Wells.2000    You know, there is so much goodness in this room it is2001unfathomable. When you think about questions of, well, does the2002fertilizer industry really want transparency, are you kidding2003me? Really? Do we really believe that? Sure, it is easy for us2004to say, but do we really believe? I mean, what we have here is2005a monopoly. We do. I mean, if we look back at ag prices, just2006think just a second about this. In 2022, not very far ago, corn2007prices were $7. Today, at harvest time this past year, they2008probably drifted significantly into the $3-and-something price.2009Do you realize that when Harry Truman was the President of this2010country, corn prices were $2.50? Go back and look.2011    Think about it. How in the world can we possibly, possibly2012not act? We have got to move now, or we are going to awaken to2013an agriculture industry that is so different than we could ever2014think, and it would be bad. It will be bad for all of us. We2015have got to do something right this minute.2016    I do not know exactly what all the answers are, but there2017are all kinds of combinations of lots and lots and lots of2018things. It can be done. It can really be done. Absolutely, we2019have got to move, and move today.2020    You know, from the standpoint of fertilizer prices, it is2021the most bewildering thing in the world. Just think about this.2022I am from a state that abounds in coal, as well. Metallurgical2023coal, is it forever more just this. You let metallurgical coal2024go from $100 a ton at the mine site to $200 a ton,2025instantaneously, freight costs will go from $30 a ton to $53 a2026ton. Then if the price goes from $200 to $300, the freight cost2027will go from $53 to $61 a ton. Nothing has changed. Nothing has2028changed.2029    It is all up to us. It is all up to all of on this2030Committee. It is all up to us as legislators to do something,2031because these people are really hurting. It is time right now.2032    Mr. Chairman, I know how much you love these people, and I2033plead with you, some way, somehow, we have got to solve the2034riddle, because they are really important.2035    God bless each and every one of you. Thank you.2036    Chairman Boozman. Thank you, Senator Justice, and very well2037said. Senator Schiff.2038    Senator Schiff. Thank you, Mr. Chairman. Mr. Green, last2039week I was lucky enough to engage with some of the agricultural2040leaders across Ventura County. These fresh produce growers2041shared a bit about their challenges being squeezed by2042retailers, whether that is not being able to sell in the2043grocery stores because imported produce is cheaper, receiving2044the same cut even when the input prices change, or essentially2045subsidizing the remainder of products sold by retailers. Can2046you elaborate on how specialty crop growers suffer when buyers2047abuse their market power, especially in a consolidated retail2048market?2049    Mr. Green. Thank you, Senator. You raise a very big2050challenge, which is there are dominant power buyers in the2051retail space that can exercise their power upstream to the2052farmer, and no matter how fabulous the product they are2053raising, they do not have the opportunity to meaningfully2054negotiate when there are so few choices of where they can bring2055their product. When the largest power buyers have the footprint2056in the market, so that if they go someplace else, or if they go2057to USDA and say, can you please inspect instead of dinging me2058without documentation for not delivering certain amounts or2059things, or when they change contract terms. You know, these are2060longer-term contracts. Well, if the price goes up, the power2061buyer keeps the same low price. If the price goes down,2062suddenly the farmer has to eat that price drop. Same thing2063around financing terms that are getting longer and longer. The2064farmer is floating the retail power buyers' no-interest rate2065loan.2066    It is real evidence that there are market power problems in2067the market you refer to. There are probably violations of the2068Perishable Agricultural Commodities Act, as well. It is the2069same type of thing we see in other sectors, as well, of this2070imbalance of market power that requires USDA, DOJ, FTC, and2071government to help balance those situations.2072    Senator Schiff. In some of those mass retailers, isn't the2073produce section really the profit driver for most of the store?2074    Mr. Green. I do not know that per se, but I think it is the2075one thing that pulls people into the door. When it is pulling2076people into the door, and it is the most attractive part of the2077store, that is something that is really important. Making sure2078that the farmer is sharing in the benefits is precisely why2079there are rules around making sure that volume discounts are2080available to every retailer, making sure that when a product2081comes, there is a USDA inspector that can make sure that the2082farmer is protected against being dinged without documentation2083by the retailer, et cetera.2084    Senator Schiff. You mentioned that some of these practices2085might violate a certain statute. Can you explain that?2086    Mr. Green. The Perishable Agricultural Commodities Act goes2087back to 1935, I think. It prohibits unfair, deceptive2088practices. It is similar to the Packers and Stockyards Act. It2089is similar to certainly the Federal Trade Commission Act. It2090basically says if you are doing business, you have got to do2091business in a fair way transparent way. These are well-2092established principles, and USDA has enforced it for a very2093long time. I do worry about staffing at the Agricultural2094Marketing Service and other places, but it is very important2095statute for the efficiency and competitiveness of the specialty2096crop industry.2097    Senator Schiff. Any other ideas you can share about how to2098equalize, even a little, the incredible disparity between the2099market power of these mass retailers and farmers?2100    Mr. Green. You have got to rein in the market power of the2101retailers. That is one of the reasons why the Robinson-Patman2102Act sets prohibitions against discriminatory, predatory, and2103other types of pricing differences, so that you can have a2104competitive retail sector, so that the dominant power buyer is2105not able to be so dominant that the farmer does not have a2106choice. If there is a competitive retail market and a retailer2107is not playing fairly, they can go someplace else and sell2108their product. If you do not deal with the concentration of2109power at the retail level, it is going to flow up to the2110farmer.2111    Senator Schiff. Thank you very much. Thank you, Mr.2112Chairman.2113    Chairman Boozman. Thank you. Senator Slotkin.2114    Senator Slotkin. I apologize for being late. I had another2115hearing that just finished up. Sorry, gentlemen, and I know you2116have gone through a lot of this. If you are getting me, you are2117at the very end, so you can rest easy.2118    I have a question. I come from Michigan, so specialty crop2119state. Obviously, we do have row crops, but specialty crops are2120what we specialize in. That tends to be small- and medium-sized2121farms. We are not the megafarms of some other states. I was2122actually hoping to ask a question of Mr. Melton. Just can you2123talk about what the pinch on fertilizer is really doing,2124particularly in your state, to some of the specialty croppers,2125you know, the fruit and vegetable folks? I feel like they are2126already on their heels because of all the uncertainty going on2127in ag generally, and they are smaller. Can you talk to me about2128what you are seeing in Kentucky?2129    Mr. Melton. Sure, Senator, thank you. You know, we all know2130what fertilizer is. It is plant food. I do not care if you are2131growing specialty crops, if you are growing row crops, if you2132are growing forage for your livestock animals, fertilizer is an2133important key to that. When you bring it down to that level,2134that is what we all are dealing with right now, so it is the2135cost of those fertilizers. In our specialty crop markets, it is2136very much noted that it is affecting them on their farms, just2137like it is all the other aspects of when we are purchasing2138fertilizer.2139    Senator Slotkin. Yes. It feels like there are so many2140variables in ag right now. Obviously, the weather you cannot2141control, but there are all these other factors that are just2142making it really hard for small- and medium-sized farmers, at2143least in my state, to keep farming. I mean, I think there are2144real existential questions going on for folks. I live on my2145family farm. I lease the land out to a soybean farmer, so I see2146those things very clearly.2147    Does anyone on the panel have a sense, you know, we have2148this chokepoint right now in the Persian Gulf, traffic is not2149getting back and forth. Let's say the Persian Gulf opened up2150tomorrow. How long do we understand it would be until that2151fertilizer actually gets through, comes back to the United2152States, and we can see this market regulating? I know the oil2153and gas people say it will be a year even if the Strait of2154Hormuz open up today. Does anyone have a sense on fertilizer?2155Sir, go ahead, please.2156    Mr. Rosenbusch. I guess that is my question, Senator2157Slotkin. Thank you for the question. Thank you for your2158knowledge of potash, too.2159    Senator Slotkin. I am a big fan of potash.2160    Mr. Rosenbusch. You have become the expert of potash, so we2161appreciate all you do there.2162    Yes, once the Strait is open, it would obviously take a2163good month for those vessels to clear and to get to the market2164destinations. What is still unclear is what the damage has been2165to those manufacturing sites in that region. We estimate that2166there are about 40 plants that have been shuttered or closed2167down because either they no longer can produce or they were2168actually damaged because of the conflict. It could be months,2169or it could be years, for those plants to come back online.2170    Senator Slotkin. Can we stay on potash for just one second,2171because look, we have discovered potash in Michigan. We are2172very excited about it. I am supportive of us mining that2173potash. What do you see as the challenge of getting that off2174the ground? I do not know, again, if there are others who also2175want to answer that.2176    I am a big believer in permitting reform and making it2177easier to make good economic decisions that affect economic2178security and national security. I think having access to2179critical minerals is part of that. Tell me what the constraints2180and the situation is.2181    Mr. Rosenbusch. I would say that, as you know, we need our2182farmers to have as much supply as possible so they can be2183successful. Permitting is a huge issue. It takes decades to get2184these mines up and running. Capital is a huge challenge, as2185well, when you are talking about billions of dollars of capital2186that it takes to run, and the return that is required. That is2187another issue. I am sure Mr. Westling can comment a little bit2188from a nitrogen perspective. Really, it is permitting and2189capital that are probably the two biggest challenges.2190    Senator Slotkin. Yes. I am a big believer. I mean, again,2191the answer can be no when you are asking for a permit. It just2192should not take 15 years to get a yes or no, right? Just get to2193decision faster.2194    Mr. Rosenbusch. Certainty. If people are putting the2195investment into these facilities, in five years, what is the2196market going to look like, and can you still justify it?2197    Senator Slotkin. I think that is fair. I do not want to2198abuse my time, Mr. Chairman, but I see there are other folks on2199the panel, if it is okay to just finish up.2200    Mr. Green. I just want to add, Senator, that you also need2201a competitive market, and you want to talk about getting new2202fertilizer. If the market is constrained and is shut, and the2203dominant powers are going to ice anybody that enters it out by2204lowering the price or squeezing them, there is really no2205incentive to invest.2206    There have been a series of mergers that go back to 2010,22072013, 2015, and 2018. All of those mergers can be reviewed by2208the FTC and the Department of Justice. Under a retrospective2209review, they can all be undone. The price of fertilizer, even2210if the Strait of Hormuz opens back up, we saw the price of2211fertilizer in 2022 drop back, but not basically to where it was2212prior to the Ukraine war. It has stayed high.2213    The issue of these longstanding trends toward concentration2214show that the underlying competitive dynamics of the market2215really do need to be addressed.2216    Senator Slotkin. Great. Thank you, Chairman. I yield back.2217    Senator Boozman: Thank you. I have just a couple of things,2218since I gave my time away to Senator Thune.2219    We talked a lot about transparency today and access to more2220information. I guess the question I would have for you, Mr.2221Kubik and Mr. Melton, as producers, what information do you2222have access to that helps you better understand the input2223markets, and what additional information would be helpful? Have2224you got anything specific that we can actually sink our teeth2225into?2226    Mr. Kubik. Thank you, Senator, for that question. I think2227right now, again, as I said before, a lot of our information2228comes from our retailers and the information they are getting.2229    Chairman Boozman. Can you understand it?2230    Mr. Kubik. Somewhat. A little bit. It is hard to fathom how2231a corn price can be here, and a fertilizer price can be here,2232even when corn was here, and fertilizer was here. It is hard to2233understand it.2234    Chairman Boozman. Sometimes it is so complex, too. There is2235so much information.2236    Mr. Kubik. Yes. I would just say if we can see ports of2237where fertilizer is coming from, like for us, Minneapolis,2238Sioux City, NOLA down in the Gulf, just to kind of get our2239heads wrapped around where that market is at, and just see the2240margin built in, see what the supply chain is like from2241manufacturer to processor to distributor to retail. Like I2242said, just to help us plan and mitigate our risk a little bit2243more.2244    Mr. Melton. We know the demand is there. We have talked2245about that several times today. I think knowing what the supply2246is that we are dealing with ahead of time, what is the supply2247going to be moving forward. Because that is what basic2248economics is, is supply and demand, and it sets price. If we do2249not know what the supply is, and we know the demand is there,2250and the supply changes all the time on us. If we had some way2251to know and predict kind of what the supply is, moving forward,2252and we have access to that information, I think it helps me, as2253a producer, and I think it would help Trent, too, knowing where2254that supply is, and if we are going to be able to get it when2255we need it.2256    Chairman Boozman. Thank you. Mr. Westling, you are in the2257process of building your new facility in Nebraska. Give us a2258thing, like I say, you are experiencing this, give us a thing2259that Congress or the Administration could do to spur increased2260domestic fertilizer production. What would have helped you?2261    Mr. Westling. Well, I think the FPEP program----2262    Chairman Boozman. Besides money.2263    Mr. Westling. Thank you for that question, Senator. I think2264the FPEP program, the construct was good, and what it wanted to2265do, and incentivizing these types of projects was a good thing,2266and ultimately could be distributed in a way that could have a2267big impact on bringing more of these to the marketplace. I do2268not think there are 20 or 30 projects that need to be built. I2269think it is a handful of places to augment the larger2270production. Bringing dollars to those projects would absolutely2271be impactful.2272    Chairman Boozman. Very good. Finally, and then we are going2273to give you all a break, we have seen military conflict, trade2274disputes, all that is going on in the world right now. We live2275in a dangerous world. This is for anybody who just wants to2276jump in. What else should we be doing to reduce our exposure to2277foreign disruptions? We have seen what blocking the Strait has2278done. This is national security. Do we need to consider, like2279we have an oil reserve? Do we need some sort of reserve of2280fertilizer? Has anybody got any ideas?2281    Mr. Green. I want to underscore the importance of seeds2282here, where seed resiliency and the seed bank at the National2283Plant Germplasm System is really a national security resource,2284so that we have the genetics to be able to adapt to regional2285varieties, and the research and the access. The Department of2286Justice filed, just yesterday, a very important statement in a2287private case around the ability to read the genetics.2288    I think fertilizer has to be thought of in context of these2289other tools that can keep us nimble, flexible, resilient, and2290self-reliant, really, across these markets.2291    Mr. Rosenbusch. Yes, Senator, thank you for that question.2292We have talked a lot about strategic reserves recently.2293Fertilizer is very different than oil and gas. It would be an2294honor to take you to some of these massive facilities and2295warehouses where some of these products are stored, and you2296will see the capital and complexity of how large these2297facilities are.2298    Fertilizer, as well, if kept for a long period of time, the2299quality can deteriorate fast. You get clumping. You start to2300see it really kind of form a big old block of concrete. It is2301not something that can be stored for long periods of time. The2302answer is let's bolster our domestic supply with projects like2303Mr. Westling's.2304    Chairman Boozman. Very good.2305    Mr. Kubik. I would add to that just simply by saying make2306the stuff where you use the stuff.2307    Chairman Boozman. Great. Thank you all very much. This has2308really been a good discussion. I think everyone on the panel2309has learned a great deal as a result of this. As you can see,2310this Committee is very serious and really does just a good job.2311We have got a great group of Members on both sides, that work2312hard. As was mentioned, agriculture, farmers are not about2313Republican farmers or Democrat farmers or Republican small2314towns or Democrat small towns. This is about trying to help out2315and trying to stabilize just a tremendous asset of this2316country.2317    With that, again, thank you for being here. The record will2318remain open for five business days, and we are adjourned.2319    [Whereupon, at 5:05 p.m., the hearing was adjourned.]23202321=======================================================================23222323                            A P P E N D I X23242325                              May 12, 202623262327=======================================================================23282329[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]23302331=======================================================================23322333                   DOCUMENTS SUBMITTED FOR THE RECORD23342335                              May 12, 202623362337=======================================================================23382339[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]23402341=======================================================================23422343                         QUESTIONS AND ANSWERS23442345                              May 12, 202623462347=======================================================================23482349[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]23502351                                 [all]