    [Senate Hearing 119-408]
    [From the U.S. Government Publishing Office]

                                                          S. Hrg. 119-408

                    PERSPECTIVES ON THE FERTILIZER INDUSTRY:
                        ENSURING A STABLE AND AFFORDABLE
                         SUPPLY FOR AMERICAN PRODUCERS
    =======================================================================

                                    HEARING

                                   BEFORE THE

                           COMMITTEE ON AGRICULTURE,
                            NUTRITION, AND FORESTRY

                              UNITED STATES SENATE

                        ONE HUNDRED NINETEENTH CONGRESS

                                 SECOND SESSION

                                   __________

                                  May 12, 2026

                                   __________

                           Printed for the use of the
               Committee on Agriculture, Nutrition, and Forestry

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

                      Available on http://www.govinfo.gov/

                                  __________

                        U.S. GOVERNMENT PUBLISHING OFFICE
    63-764 PDF                  WASHINGTON : 2026
    =======================================================================

               COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY

                        JOHN BOOZMAN, Arkansas, Chairman
    MITCH McCONNELL, Kentucky            AMY KLOBUCHAR, Minnesota
    JOHN HOEVEN, North Dakota            MICHAEL F. BENNET, Colorado
    JONI ERNST, Iowa                     TINA SMITH, Minnesota
    CINDY HYDE-SMITH, Mississippi        RICHARD J. DURBIN, Illinois
    ROGER MARSHALL, Kansas               CORY BOOKER, New Jersey
    TOMMY TUBERVILLE, Alabama            BEN RAY LUJAN, New Mexico
    JAMES C. JUSTICE, West Virginia      RAPHAEL WARNOCK, Georgia
    CHARLES GRASSLEY, Iowa               PETER WELCH, Vermont
    JOHN THUNE, South Dakota             JOHN FETTERMAN, Pennsylvania
    DEB FISCHER, Nebraska                ADAM SCHIFF, California
    JERRY MORAN, Kansas                  ELISSA SLOTKIN, Michigan

                   Fitzhugh Elder IV, Majority Staff Director
                      Corey Weber, Majority Chief Counsel
                        Jessica L. Williams, Chief Clerk
                    Lauren Santabar, Minority Staff Director
                     Chu-Yuan Hwang, Minority Chief Counsel

                                C O N T E N T S

                                  ----------

                             Tuesday, May 12, 2026

                                                                       Page

    Hearing:

    Perspectives on the Fertilizer Industry: Ensuring a Stable and
      Affordable Supply for American Producers.......................     1

                                  ----------

                        STATEMENTS PRESENTED BY SENATORS

    Boozman, Hon. John, U.S. Senator from the State of Arkansas......     1
    Klobuchar, Hon. Amy, U.S. Senator from the State of Minnesota....     2

                                    WITNESS

    Green, Andy, Principal and Senior Advisor, Center Market
      Strategies, Washington, DC.....................................     5
    Kubik, Trent, President, South Dakota Corn Growers, Hamill, South
      Dakota.........................................................     7
    Melton, Eddie, President, Kentucky Farm Bureau Federation,
      Louisville, Kentucky...........................................     9
    Rosenbusch, Corey, President and CEO, The Fertilizer Institute,
      Arlington, Virginia............................................    10
    Westling, Joshua, CEO, J. Westling & Co., LLC, Omaha, Nebraska...    12
                                  ----------

                                    APPENDIX

    Prepared Statements:
        Green, Andy..................................................    42
        Kubik, Trent.................................................    60
        Melton, Eddie................................................    72
        Rosenbusch, Corey............................................    81
        Westling, Joshua.............................................   117

    Document(s) Submitted for the Record:
    Boozman, Hon. John:
        Eggnite Agricultural Solutions, LLC, Letter for the Record...   126
        Op-Ed: Secretary Brooke Rollins: President Trump is ensuring
          fertilizer affordability and availability for our farmers..   133
        The United Steel, Paper and Forestry, Rubber, Manufacturing,
          Energy, Allied Industrial and Service Workers International
          Union (USW), Letter for the Record.........................   135
        Stephen Vaden, Deputy Secretary of Agriculture, Letter for
          the Record.................................................   137
    McConnell, Hon. Mitch:
        Prepared statement from Senator Mitch McConnell..............   138

    Question and Answer:
    Melton, Eddie:
        Written response to questions from Hon. Adam Schiff..........   144
    Rosenbusch, Corey:
        Written response to questions from Hon. Adam Schiff..........   146

        PERSPECTIVES ON THE FERTILIZER INDUSTRY: ENSURING A STABLE AND
                    AFFORDABLE SUPPLY FOR AMERICAN PRODUCERS

                                  ----------

                             TUESDAY, MAY 12, 2026

                                            U.S. Senate
              Committee on Agriculture, Nutrition, and Forestry
                                                        Washington, DC.
        The Committee met, pursuant to notice, at 3 p.m., in Room
    106, Dirksen Senate Office Building, Hon. John Boozman,
    Chairman of the Committee, presiding.
        Present: Senators Boozman [presiding], McConnell, Hoeven,
    Ernst, Marshall, Justice, Grassley, Thune, Fischer, Moran,
    Klobuchar, Smith, Lujan, Warnock, Welch, Schiff, and Slotkin.

       STATEMENT OF HON. BOOZMAN, U.S. SENATOR FROM THE STATE OF
     ARKANSAS, CHAIRMAN, U.S. COMMITTEE ON AGRICULTURE, NUTRITION,
                              AND FORESTRY

        Chairman Boozman. Thank all of you very much for being here
    today. As we all know, this hearing is being held during what
    continues to be a very precarious time across America's
    agricultural economy. I would call that an understatement. I
    would say it is a generational event.
        While input prices for our producers have been stubbornly
    high for the past several years, this situation has recently
    become more acute as farm bankruptcies increase, fuel prices
    remain high, and interest rates have yet to come down. The cost
    of fertilizer, the topic of today's hearing, has also gone up,
    and I look forward to hearing from our witnesses about the
    current state of the fertilizer industry, how these high prices
    directly affect our producers, and what potential solutions
    exist for Congress to ensure a stable and affordable supply of
    this important crop input. Again, this is a national security
    issue.
        This is not a simple problem to address, as fertilizer is
    not a single, uniform input. Nitrogen, phosphate, and
    potassium, commonly referred to as N, P, and K, present a
    complicated picture of global supply chains that have been
    affected by the war in Ukraine, trade disputes that have also
    resulted in countervailing duties, and the recent conflict in
    the Middle East. Today's hearing is an important opportunity to
    learn more about how these factors, and others, directly impact
    producer costs.
        I want to commend the Trump Administration for the
    attention it has given to high fertilizer prices. Over the last
    couple months, the Administration has responded by waiving the
    Jones Act and refocusing the Fertilizer Product Expansion
    Program to ensure projects funded under this program are up and
    running as soon as possible.
        In November, U.S. Department of Interior Secretary Doug
    Burgum also announced the addition of phosphate and potash to
    the crucial minerals list, which will streamline regulatory
    hurdles and increase domestic production of these fertilizer
    inputs. These minerals' important to food security, which is
    national security, were clear, and this was a welcome and much-
    needed change.
        U.S. Department of Agriculture Secretary Rollins has
    continued to engage with our producers and brought together her
    colleagues from across the Administration to determine what
    additional steps they can take to provide relief.
        Several Members of this Committee have also proposed
    legislative solutions to address higher fertilizer prices, and
    I welcome hearing from our witnesses about proposals. How they
    may help; and what additional actions Congress and the
    Administration might take to ensure a reliable and accessible
    affordable supply of fertilizer for hardworking American
    farmers.
        With our colleagues in the House successfully passing a
    bipartisan farm bill 2.0, I look forward to engaging with the
    Members of this Committee on what we learn today to ensure a
    Senate version addresses the urgent needs of agriculture.
    Congress owes our Nation's producers an updated farm bill that
    will complement the improvements we made last year in the One
    Big Beautiful Bill, and I am committed to making that happen.
        While the proposals and solutions we hear about today may
    help increase production of fertilizer and bring down prices in
    the long-term, in the immediate future, Congress must provide
    additional assistance to supplement what USDA provided with the
    Farmer Bridge Payments and the Assistance for Specialty Crop
    Farmers programs, to ensure producers have the working capital
    available to see them through the 2026 crop season.
        I have been working with my friend, Senator Hoeven, to
    advocate for this assistance and appreciate President Trump's
    acknowledgement of this need when a larger supplemental funding
    package is requested.
        Before I turn it over to Ranking Member Klobuchar for her
    opening statement, I ask unanimous consent that statements sent
    to the Committee for this hearing be included in the record,
    including an op-ed written by USDA Secretary Rollins and a
    statement submitted to the Committee by Deputy Secretary Vaden.
    Without objection, so ordered.
        [The letters can be found on pages 126-137 in the
    appendix.]
        Chairman Boozman. Again, I thank my colleagues and our
    witnesses for being here today.
        With that, I now turn to Ranking Member Klobuchar for her
    opening statement.

      STATEMENT OF HON. KLOBUCHAR, U.S. SENATOR FROM THE STATE OF
                               MINNESOTA

        Senator Klobuchar. Thank you very much, Chairman Boozman,
    and thank you for holding this important hearing today and for
    bringing such distinguished witnesses. In particular, I would
    mention the farmers who have come to Washington in the middle
    of planting season to share their perspective. Thank you for
    doing that, including a number from Minnesota.
        As we hear from our witnesses today, I would say that
    farmers need policies that encourage new investment, reduce
    supply disruptions, and improve transparency in the fertilizer
    market. We know there are many reasons that fertilizer prices
    are astronomically high. They were high before the war started,
    but I will note that there is a direct link between recent
    escalations and this war.
        In the months since the President started the war, with no
    consultation or authorization from Congress, fertilizer
    prices--urea has spiked more than 40 percent, and the cost of
    diesel has hit near record highs in Midwest states. Now, why?
    Well, nearly half of the global urea goes through the Strait of
    Hormuz. Thirty percent of ammonia goes through the Strait of
    Hormuz.
        Yet even before the war, farmers were walloped by the
    presence of across-the-board tariffs. An analysis by North
    Dakota State University--you may not like the result, go Bison,
    here is what it found--found that IEEPA tariffs added nearly $1
    billion in costs to critical inputs like fertilizer, seed,
    machinery, and chemicals from February through October of last
    year.
        I was at the Supreme Court argument, and as you are well
    aware, the Supreme Court found the tariffs illegal. Last week,
    the Court of International Trade ruled against the President's
    authorities to use a different statute for these tariffs.
    Again, they are not targeted. They are across the board, and it
    has led to part of these problems.
        Just last month, I was at a family farm in Cannon Falls,
    Minnesota, where I met with corn and soybean farmers who are
    facing escalating costs this planting season. Many of them said
    stubbornly high fertilizer prices have been an issue for years
    in a market with little competition. Some of them were able to
    lock in before the war, not knowing it was going to happen, but
    others now are even in worse shape.
        Beyond the geopolitical challenges, there are other
    reasons: farmers have just a handful of domestic suppliers to
    choose from, with little transparency about the prices that
    they ultimately pay. In 2024, just four fertilizer companies
    accounted for 77 percent of U.S. nitrogen fertilizer sales and
    all domestic potash and phosphate. That is why I partnered with
    Senator Thune, who is here with us, and farmers in our states,
    to introduce the Fertilizer Price Transparency Act to create a
    mandatory price reporting structure at USDA to ensure farmers
    and co-ops have adequate market information on fertilizer
    components, especially at times when we see major supply chain
    shocks. We believe getting this information out there would be
    very helpful.
        Aside from price transparency, we need to increase domestic
    fertilizer production and storage. Senator Marshall, who is
    also with us, and I have introduced the Homegrown Fertilizer
    Act to do just that, so we can ease our dependence on imports.
    I know Senator Grassley and others on this Committee have
    introduced other pieces of legislation to address these issues.
        Acting now will ultimately help stabilize prices and give
    farmers the certainty they need. It is going to have to be a
    combination of things: ending the tariffs, or reducing them, or
    making them much more targeted, ending this war, finding a way
    to resolve it, so the Strait of Hormuz is open again, and then
    going at this long-term systemic problem about the lack of
    competition in this area.
        Thank you to our witnesses today.
        Chairman Boozman. Thank you. We will now introduce our
    witnesses.
        We are going to Senator McConnell first to introduce our
    witness from Kentucky.
        Senator McConnell. Thank you, Mr. Chairman. You know how
    politicians frequently refer to each other as ``my friend'' or
    ``my good friend.'' It is usually not true.
        [Laughter.]
        Senator McConnell. Frequently, we say that about some of
    our constituents. I have got a prepared text here. I am going
    to ask the Chairman to put it in the record.
        [The letter can be found on pages 138-141 in the appendix.]
        I want to tell you about Eddie Melton. We have been
    literally friends for decades. We have worked together on issue
    after issue after issue for a big part of the 42 years I have
    been here. He is bright as hell and is extremely creative.
        Example, a year or so ago, he came to me and said, ``I'm
    really, really concerned, as I'm sure we all are, about the
    loss of farmland.'' Not only did he say he was concerned about
    it, he had an idea about how to make it less likely to happen,
    which was to give a tax relief proposal for people who bought a
    farm if they agreed to continue farming for at least 10 years.
        I took that idea and put it in the Big Beautiful Bill. It
    is law. If Eddie had not thought of that it would not have
    happened.
        I can tell you, he has made a difference, not only for
    Kentucky agriculture but for agriculture all across the
    country. I just wanted to come by, Eddie, and thank you for all
    you have done.
        Thank you, Mr. Chairman.
        Chairman Boozman. Thank you very much. Senator Klobuchar.
        Senator Klobuchar. Thank you very much, Mr. Chair. It is my
    pleasure to welcome Andy Green to the Committee today. Mr.
    Green is a partner in Center Market Strategies, a bipartisan
    firm dedicated to keeping markets fair, and ensuring a seat at
    the table for businesses of all sizes. He previously served as
    the first senior advisor for Fair and Competitive Markets at
    the USDA during the previous administration, where he
    spearheaded efforts to promote competitive markets across
    agriculture.
        In addition, he worked for the Public Company Accounting
    Oversight Board, the U.S. Securities and Exchange Commission,
    and started his career in D.C. here in the Senate for Senator
    Merkley of Oregon. Thank you for joining us today.
        Chairman Boozman. Senator Thune.
        Senator Thune. Thank you, Mr. Chairman, and by the way,
    thank you for shining a light on this really important subject.
    I am glad we are having this hearing. We need to get to the
    bottom of one of the biggest challenges farmers are facing
    these days, and that is the cost of inputs, particularly
    fertilizer.
        It is my pleasure, Mr. Chairman, to introduce to the
    Committee Trent Kubik. He is not only the current President of
    the South Dakota Corn Growers but also a farmer and a rancher,
    along with his wife and parents. They farm near Hamill, South
    Dakota, raise corn, soybeans, alfalfa, and milo, alongside
    their cow-calf operation. By the way, for any of you who have
    been to South Dakota, in that part of South Dakota, they also
    have a very, very abundant pheasant supply.
        Trent graduated from South Dakota State University with a
    degree in agronomy. He and his wife Shannon have two sons. He
    stays very busy as a certified crop advisor and as a
    volunteer--FFA and 4-H volunteer, and he is a very active
    member of his church. I know also that he is a person--a man--
    of great courage because he is a diehard Green Bay Packer fan
    in Viking country, which is a distinction that we share, by the
    way.
        I am very pleased to have him here today and look forward
    to hearing a South Dakota perspective on this issue. Trent,
    welcome.
        Thank you, Mr. Chairman.
        Chairman Boozman. Corey Rosenbusch serves as The Fertilizer
    Institute's President and CEO, where he is responsible for
    leading efforts to advance the fertilizer industry. Before
    joining TFI, Mr. Rosenbusch served as President and CEO for the
    Global Cold Chain Alliance and worked for The Borlaug
    Institute. Mr. Rosenbusch holds a degree in international
    development from Harvard University, a bachelor of science
    degree in agriculture education from Texas A&M. That is a
    combination. We appreciate you being here very, very much.
    Senator Fischer.
        Senator Fischer. Thank you, Mr. Chairman. I am pleased
    today to introduce Mr. Joshua Westling, who is here today as a
    witness for this Committee on a very, very important subject.
    Mr. Westling is leading the development of Project Meadowlark,
    a new fertilizer plant in Gothenburg, Nebraska. This facility
    is projected to produce 5,000 tons of liquid fertilizer and
    reach commercial operation. I am afraid not until 2029.
        Before working on Project Meadowlark, Mr. Westling led the
    development and construction of an anhydrous ammonia plant in
    Geneva, Nebraska, that became one of the few greenfield
    nitrogen fertilizer facilities built here in this country.
        Mr. Westling, we are so happy to see you here today, and I
    look forward to your comments. Thank you.
        Chairman Boozman. Thank you. Mr. Green, you are recognized.

     STATEMENT OF ANDY GREEN, PRINCIPAL AND SENIOR ADVISOR, CENTER
                   MARKET STRATEGIES, WASHINGTON, DC

        Mr. Green. Thank you, Chairman Boozman and Ranking Member
    Klobuchar, for the opportunity to testify this afternoon.
        We are here because the American farmer is hurting. For
    more than five years, farmers have endured both price spikes
    and sustained higher prices, squeezing their margins and
    affecting their planting choices.
        It is well known that fertilizer markets are highly
    concentrated. Indeed, one relatively recent merger created a
    giant that controls six percent of one type of fertilizer and
    30 percent of the market for another. Amazingly, Federal Trade
    Commission economists took a victory lap barely two years after
    its completion to say everything is fine. That was a mistake.
        What are the pillars of building fair, more competitive
    fertilizer markets? First, enforcement. I am pleased to see
    this Administration has prioritized investigations into
    agricultural competition around both agricultural inputs and
    cattle markets. I hope their efforts yield fruit. I would be
    pleased if they were building on the groundwork laid out
    previously, for example, with the Agri Stats case.
        High, sustained increases in profits should also be cause
    for antitrust scrutiny, particularly in light of market shocks
    that are repeating today. To that end, it may be appropriate to
    reconsider those recent mergers that have helped form this
    highly concentrated sector. Effective enforcement of the law
    also requires funding and staffing at agencies, including USDA.
        Second, more transparency would be beneficial for a more
    accountable fertilizer market. Kudos to the bipartisan sponsors
    of legislation to enhance USDA's role in providing additional
    transparency, including, in particular, S. 4152, the Fertilizer
    Transparency Act of 2026.
        Public reporting can highlight, and in some cases, deter
    problematic trends, for example, where there is a disconnect
    between price and underlying supply and demand. In that way,
    transparency can lead to beneficial outcomes for farmers even
    beyond their use of the information itself. I also commend the
    legislation for its use of modern dashboards, and the bill
    appropriately preserves the ability for the data to be used for
    enforcement purposes. Additionally, regular public company
    disclosures should be preserved and enhanced as valuable for
    both investors' and for farmers' risk management.
        Third, investment in an important tool for enhancing
    competitive markets. The Fertilizer Production Expansion
    Program, FPEP, was USDA's $900 million commitment to support
    American-made sustainable fertilizer capacity in the face of
    similarly sharply increasing prices and long-term trends toward
    concentration. Over the course of three years, FPEP invested
    over $778 million in more than 100 projects across 39 states.
    That adds up to an estimated 12 million tons of new production
    online and more than 1,500 jobs. More than $100 million remains
    available to the program, and more via the CCC.
        Funding for USDA's Rural Cooperative and Business Services
    and the Agricultural Marketing Service are important for these
    types of efforts and others that benefit more choices for
    farmers.
        Fourth, consumers can support pro-competition initiatives
    incentives upstream for farmers. Clear labels for consumers
    help producers that actually do the hard work of delivering
    value-added products that consumers want. In fertilizer,
    opportunities may exist to align America's desire for healthy
    food and a clean environment with competition and resiliency in
    fertilizer. Expanding biofertilizer and nutrient recycling
    options for farmers should be part of the equation.
        Fifth and finally, economic research and academic legal
    analysis are foundational aspects of building and maintaining
    effective market competition. Government investment in
    objective, unbiased research, such as the land-grant university
    system, helps policymakers identify trends and design
    interventions to restore market competitiveness.
        I want to particularly highlight the importance of research
    into seed resiliency. New varieties can help support more
    efficient fertilizer choices. To that end, special attention
    should go to ensuring the maintenance and staffing for the
    Agricultural Research Service's National Plant Germplasm System
    to avoid the loss of irreplaceable genetics, including in corn.
        In conclusion, more can and should be done on a bipartisan
    basis to enhance competition in the fertilizer sector so that
    America's farmers can compete based on hard work, smart
    investments, and nature's abundance. Thank you very much.
        [The prepared statement of Mr. Green can be found on pages
    42-59 in the appendix.]
        Chairman Boozman. Thank you. Mr. Kubik.

    STATEMENT OF TRENT KUBIK, PRESIDENT, SOUTH DAKOTA CORN GROWERS,
                               HAMILL, SD

        Mr. Kubik. Chairman Boozman, Ranking Member Klobuchar, and
    Members of the Senate Agriculture Committee, thank you for the
    opportunity to speak here today. My name is Trent Kubik. I am a
    farmer from Hamill, South Dakota, and President of the South
    Dakota Corn Growers Association.
        I farm in an area of the country where weather varies much
    more than normal, and more often than not, we are threatened by
    lack of rainfall. Due to this, we try and limit the amount of
    fertilizer we purchase and apply at the start of the year to
    determine if we need more while the crop is growing, which, in
    turn, does not allow us to early book and/or prepay all of our
    fertilizer needs.
        In the first few months of this year, we were not in a
    position to book or prepay for any fertilizer, so we expected
    our costs were going to be higher than normal, as we would be
    purchasing closer to peak demand season, but now we are left
    with costs nearly doubling. This leads me to ask, what is
    causing fertilizer to increase in price?
        Despite the cost of natural gas in the U.S. being
    relatively cheaper than any fertilizer-producing area in the
    world, the price of nitrogen fertilizer in the U.S. has
    continued to rise in concert with prices in areas with higher-
    costing natural gas. The resulting rise in margins for U.S.
    manufacturers should, in theory, encourage expansion of
    production and higher capacity utilization for the industry.
    Instead, market power has allowed manufacturers to maintain
    higher prices at the expense of the U.S. farmer.
        In fact, last week, a Bloomberg article showed the recent
    earning reports indicate record profits for fertilizer
    companies. When my input price goes up, my profit margin
    shrinks. I will be frank. It is unclear to corn farmers in
    South Dakota how the opposite is possible for the fertilizer
    industry.
        What I do know is that profit increase illustrate an
    industry that does not have to increase my fertilizer prices
    but can do so. In my written testimony, I also included
    analysis that indicated the use of market power to directly
    impact fertilizer pricing. An analysis conducted in 2024
    illustrated the producer price index, measuring the change in
    price of goods sold, both for corn and nitrogen, indicating
    that nitrogen fertilizer prices nearly precisely tracked
    increases in corn prices.
        What is the structure of this marketplace? Over the past 40
    years, fewer and fewer fertilizer firms serve the U.S. farmer,
    due in no small part to industry mergers. By almost any
    measure, these are highly concentrated markets.
        In addition, large manufacturers appear to have developed
    and to own distribution networks. For instance, Nutrien
    operates the largest direct-to-grower distribution network with
    distribution points and retail locations. Unfortunately, there
    is limited publicly available information regarding
    distributors and wholesalers.
        It is important to note that vertical integration has not
    led to the efficiency gains passed on to growers and consumers.
    Instead, our experience is that the integration has resulted in
    the largest fertilizer companies locking up and leveraging
    distribution channels, entrenching their dominant position, and
    extracting excessive profits from farmers and consumers. Market
    power allows even the simple act of storing these products to
    be turned against the farmer.
        For instance, it is my understanding that the fertilizer
    manufacturers are able to park barges of product and hold onto
    inventory. In addition, under a scenario where there are only
    two market participants, the first market participant could set
    the price for a barge of fertilizer, with the second one
    following at that price. It is easy to see how this might
    occur.
        We also need the ability of manufacturers to exert pressure
    downstream on wholesalers and retailers to be mitigated. As I
    have already mentioned, there is not significant amounts of
    information available to the public about wholesalers. I have
    heard credible reports of practices that undoubtedly could
    affect farmers, such as the delay in availability of fertilizer
    books by a retailer, but it is difficult to assess what is
    really happening, due to the opaque nature of parts of that
    supply chain.
        Two key pieces of legislation would be helpful to begin to
    provide the type of data needed to assess the use of market
    output control. The Fertilizer Transparency Act of 2026 would
    increase the data available to help improve market signals by
    providing public access to meaningful pricing data and give
    farmers a tool to help plan for these costs. Ultimately, this
    legislation will make the market for key farm inputs more
    transparent and therefore represent a step toward making the
    market more competitive. It also might help provide data that
    would aid in the analysis of whether market control has been
    used to limit the supply of fertilizer. We greatly appreciate
    South Dakota Senator John Thune and Ranking Member Klobuchar
    for introducing this much-needed step toward market
    transparency.
        In addition, the Fertilizer Research Act authorizes a study
    on fertilizer competition trends and pricing. This bill also
    increases transparency and would provide much-needed
    information to better assess the marketplace, including key
    data such as sectors capacity utilization rates. We thank
    Senate Judiciary Chair Chuck Grassley and Senator Tammy Baldwin
    for introducing this bill.
        Simply put, farmers need more competition in this
    marketplace. We thank the U.S. Department of Ag Deputy
    Secretary Stephen Vaden for his significant interest in this
    area and call upon the federal agencies that signed the
    September 2025 Memorandum of Understanding to take meaningful
    steps toward solutions to concentration in this subsector.
    Federal antitrust laws exist for precisely this reason, to
    promote and sustain competition, the lifeblood of our economy.
        Increased competition for more participants in the
    fertilizer manufacturing space is the only thing that can
    deliver meaningful and durable price relief.
        Thank you again for the opportunity to be here and thank
    you to Chairman Boozman and Ranking Member Klobuchar for taking
    up such a critical issue of fertilizer. I look forward to your
    questions.
        [The prepared statement of Mr. Kubik can be found on pages
    60-71 in the appendix.]
        Chairman Boozman. Thank you very much. Mr. Melton.

      STATEMENT OF EDDIE MELTON, PRESIDENT, KENTUCKY FARM BUREAU
                       FEDERATION, LOUISVILLE, KY

        Mr. Melton. Chairman Boozman, Ranking Member Klobuchar, and
    Members of the Senate Ag Committee, my name is Eddie Melton and
    I am fifth-generation row crop and beef cattle farmer from
    Webster County, Kentucky, and I currently serve as President of
    Kentucky Farm Bureau. It is an honor to be with you today to
    speak on behalf of the farmers of Kentucky as well as the
    470,000 Kentucky Farm Bureau member families.
        My family has been farming in Webster County since 1900,
    when my great-great-grandfather purchased our farm. During my
    lifetime, I have helped bring in more than 50 years of crops.
    We typically raise corn, soybeans, canola, wheat, and beef
    cattle. My business partner, Patrick Howard, and I made a
    decision last August to not plant wheat and canola, due to the
    increased fertilizer price. This is the kind of decisions
    farmers across the country have had to make.
        This hearing comes at a critical time as we assess the
    current state of the farm economy and the ongoing challenges
    facing American agriculture. Today's fertilizer price
    challenges do not begin with the recent conflict in Iran. While
    global tensions often draw attention to input markets, prices
    for fertilizer have been elevated for years. Though the current
    crisis is not new, disruptions in the Strait of Hormuz have,
    beyond a doubt, exacerbated the problem. The shipping
    disruptions contributed to an increase in the price of nitrogen
    fertilizer. The unpredictability in the region has led to
    concerns about availability, not for just this current crop
    year but also for next year, as well.
        Since February, we have seen a 33 percent rise in anhydrous
    prices, a 55 percent rise in urea prices, and a 25 percent
    increase in liquid nitrogen. All the while, corn prices have
    declined from $7 a bushel in 2022 to approximately $4.50 per
    bushel today. Meanwhile, many farmers are operating with little
    or no working capital, limiting their ability to manage risk or
    invest in future production.
        In the first quarter of 2026, 86 farms have already filed
    for Chapter 12 bankruptcy, including 25 of those in the
    southeastern region.
        Last month, American Farm Bureau Federation conducted a
    Fertilizer Availability Survey of more than 5,700 farmers and
    ranchers nationwide. The results highlight significant
    challenges in fertilizer access. Affordability challenges are
    especially acute in the South, with roughly 78 percent of the
    respondents indicating that they were unable to afford all the
    fertilizer they need. In my home State of Kentucky, just 29
    percent of farmers were reported to be able to prebook
    fertilizer, with almost 72 percent stating that they could not
    afford all the fertilizer that they needed this growing season.
        Addressing these challenges requires both immediate and
    long-term action. In the near term, greater transparency in the
    fertilizer market and ensuring farmers have access to the
    fertilizer they need to get through this growing season is
    essential. We appreciate the efforts of the Administration so
    far, but we continue to call on the President and Congress to
    do everything in their power to increase availability of
    fertilizer and ease the price burdens on farmers this growing
    season.
        Over the longer term, the United States must strengthen its
    domestic fertilizer production capacity. We are grateful to the
    Administration, especially Secretary Rollins and the team at
    USDA, for the work on this issue. Expanding domestic production
    would improve supply reliability and help moderate price
    volatility over time.
        These challenges facing agriculture today are the result of
    sustained economic pressure that is reshaping the farm economy.
    According to the last USDA census, we lost more than 20 million
    acres of farmland and almost 200,000 farms nationwide. If farm
    closures, farmland loss, and consolidation continue, the long-
    term structure of American agriculture will begin to change.
    Ensuring that producers have access to affordable inputs and
    fair, transparent markets is critical, not only for their
    operations but for the long-term stability of American
    agriculture and national food security.
        For producers operating on thin margins, there is no
    flexibility to wait for longer-term solutions. That is why
    near-term support matters. Congress should act now with
    additional economic assistance to help farmers manage today's
    cost pressures to prevent further financial strain and
    stabilize operations while longer-term fixes are put in place.
        Chairman Boozman, Ranking Member Klobuchar, and Members of
    the Committee, thank you for the opportunity to speak to you
    today as both as a farmer and as President of Kentucky Farm
    Bureau. This Committee's work is so important to agriculture
    and the farm economy to ensure the reliable supply of food,
    fiber, and fuel for generations to come. Thank you.
        [The prepared statement of Mr. Melton can be found on pages
    72-80 in the appendix.]
        Chairman Boozman. Thank you. Mr. Rosenbusch.

         STATEMENT OF COREY ROSENBUSCH, PRESIDENT AND CEO, THE
                  FERTILIZER INSTITUTE, ARLINGTON, VA

        Mr. Rosenbusch. Thank you, Chairman Boozman, Ranking Member
    Klobuchar, and Members of the Committee.
        The Fertilizer Institute represents manufacturers,
    importers, wholesalers, and retailers who serve America's
    farmers. There are over 500 producers of fertilizer globally,
    and the United States is one of three countries that has more
    than 20 unique companies producing fertilizer. Half of all the
    crop yields in the world today are only possible through the
    use of these crop nutrients. Thank you, farmers, because
    without farmers, there would be no fertilizer industry.
        I grew up in a small Texas town where my dad was my FFA
    advisor, and it was really FFA that broadened my horizons to
    leave rural America and move to Indonesia, where I spent three
    years helping smallholder farmers. It was really that
    experience that shaped my view on agriculture. Whether you farm
    in Indonesia or in Iowa, farmers are highly exposed to global
    markets.
        Fertilizer is one of those global markets, which is not a
    single product, but they are typically represented by three
    macronutrients, nitrogen, phosphate, and potash, each with its
    own unique market dynamics.
        The United States does have significant production of
    nitrogen and phosphate, and while we do have some potash
    production, we import over 98 percent. The U.S. only accounts
    for seven percent of total global fertilizer production, and we
    are a net importer of fertilizer. Over 90 percent of all
    fertilizers applied in the world are actually used outside of
    the United States.
        We also have one of the world's most sophisticated
    logistics systems to enable large-scale delivery of fertilizer.
    That infrastructure helps support strong competition and
    options for farmers, from both domestic and international
    suppliers to the market.
        Please hear this. Fertilizer is a globally traded commodity
    that is subject to fierce competition and global supply and
    demand.
        To understand that supply and demand, we really have to
    begin with geopolitics, starting with Iran. The closure of the
    Strait of Hormuz impacted about 34 percent of globally traded
    urea, 20 percent of phosphate, and half of the world's sulfur
    exports. Iran itself is actually the second-largest exporter of
    urea, with about 12 percent of the marketplace. Twenty percent
    of the natural gas is supplied from the region, and natural gas
    is the feedstock, of course, for all nitrogen fertilizer.
        The Strait is really only part of the story. There have
    been 31 ammonia plants in the region that have curtailed
    production or have been damaged during the conflict. Another 49
    plants in India and South Asia were also shuttered due to
    disruption of their natural gas supply from the region. Even
    with the Strait reopening, we do not know the extent of the
    damage to those production facilities.
        These issues really just exacerbated what was already a
    very tight global supply. China, who is the world's largest
    producer of fertilizer, with about a third of all nitrogen
    production and 43 percent of the global phosphate supply, are
    currently restricting all of their exports. Twenty Russian
    nitrogen plants have been damaged due to Ukrainian drone
    strikes, and Russia also has implemented an export ban on their
    fertilizer, or restriction.
        At the same time, we are also experiencing strong demand
    for fertilizer. For example, in India, the world's second-
    largest consumer of fertilizer behind China, their Federal
    Government procures their fertilizer. They then heavily
    subsidize it to keep prices low for their farmers. Because a
    significant volume of urea was stranded behind the Strait,
    India recently did another urea tender for 2.5 million metric
    tons of urea, at nearly $1,000 per metric ton.
        We recognize that this is a very challenging and
    frustrating time for our farmers, that are already experiencing
    very low crop prices. That is why we would like to be a
    partner, to develop solutions.
        In the interest of time, I will refer to my written
    testimony for some of those solutions, but we support policies
    that bolster domestic supply. Ammonia facilities can take more
    than five years and cost $4 to $5 billion to build, or a decade
    or more for development of a potash or phosphate mine.
        We also support transparency. Farmers need a reliable
    source of data and market information. We have proposed the
    creation of a crop input economist at USDA that can analyze
    price information and supply factors to aid farmers in their
    decision-making.
        Even with these policy solutions, I want to be clear that
    fertilizer is a globally traded commodity. While we cannot
    directly influence prices, we can produce productive policies
    to bolster domestic supply that mitigates geopolitical risks
    for the American farmer. Thank you.
        [The prepared statement of Mr. Rosenbusch can be found on
    pages 81-116 in the appendix.]
        Chairman Boozman. Thank you. Mr. Westling.

      STATEMENT OF JOSHUA WESTLING, CEO, J. WESTLING & CO., LLC,
                               OMAHA, NE

        Mr. Westling. Chairman Boozman, Ranking Member Klobuchar,
    Members of the Committee, thank you, and Senator Fischer, thank
    you for the introduction.
        My name is Joshua Westling. I am the Founder and CEO of J
    Westling & Company, and I am leading the development of Project
    Meadowlark, a new domestic fertilizer complex in Gothenburg,
    Nebraska. I am the only developer of new domestic fertilizer
    capacity testifying today, and I want to give you a candid view
    from the front line.
        Six years ago, I started working on this project because
    the fertilizer supply problem in our region was getting worse,
    and nobody was solving it. Nebraska is consistently one of the
    largest agricultural markets in the United States, with farm
    cash receipts approaching $40 billion annually, and we are one
    of the largest markets for UAN and ATS in the country, yet
    local production of nitrogen fertilizer is minimal relative to
    what we consume. The cost of moving fertilizer to where it is
    needed and the consequences when it does not arrive on time are
    borne by our farmers. Very often, they are also exposed to
    supply disruptions, thousands of miles away from their
    operations.
        Project Meadowlark helps change that. Once it reaches
    commercial operation in 2029, it will produce 365,000 tons of
    UAN per year, 140,000 tons of ATS, and 52,000 tons of diesel
    exhaust fluid. The plant is fully integrated. We produce
    ammonia as an intermediate, but every pound is converted onsite
    into products our farmers and truckers actually use.
        This is the second greenfield nitrogen fertilizer plant I
    will have developed. When Fortigen came online in 2018, it was
    one of only three greenfield nitrogen fertilizer plants of
    meaningful scale built in the United States in over 30 years.
    Project Meadowlark will be the fourth. My team and I have done
    this before.
        The total budget for this project is over $1 billion
    dollars. We have raised over $50 million in predevelopment
    capital to date, the substantial majority from regional
    investors, farmer-aligned partners, and members of our
    community. These are the people who understand the supply
    problem most directly, because they live it every season. They
    have always believed the Federal Government should have a role
    in solving this problem, but they also recognize the government
    often acts only in response to crisis, so they took the
    initiative. I am honored and humbled by their support. I take
    very seriously the responsibility of delivering what we say we
    will deliver. When farmers are putting their own capital into
    restoring domestic fertilizer production that is essential to
    our Nation's farm and food security, that is rural America
    trying to tell you something.
        One challenge unique to fertilizer projects is that so
    little domestic nitrogen capacity has been built in the United
    States over the past several decades. Unlike sectors such as
    power generation or data centers, there are relatively few
    recent reference projects for institutional investors, lenders,
    engineers, and contractors to rely upon. As a result,
    substantially more diligence, engineering work, and development
    capital are required before large-scale, private capital can
    move with confidence. Early-stage funding, through any number
    of mechanisms, is one of the biggest areas of opportunity for
    any capital deployment program, new or pursuing.
        I support the framework announced on April 29th by
    Secretaries Rollins, Lutnick, and Bergum, Administrator Zeldin,
    Director Hassett, and others as a serious response to a serious
    problem, and this Committee's bipartisan engagement is exactly
    what this moment requires. If domestic fertilizer production is
    truly a strategic infrastructure, then we need to finance and
    permit it like strategic infrastructure.
        I want to use my remaining time to highlight three
    additional steps that would meaningfully strengthen American
    farm and food security. First, predictability and execution
    certainty. If domestic fertilizer capacity is truly a strategic
    priority then federal timelines must operate with the urgency
    that this priority requires. Clear and predictable timelines
    allow private capital to move faster on strategically important
    projects to come online sooner.
        Second, coordination across agencies and programs. Large
    industrial projects move through multiple federal processes
    simultaneously. When agencies operate independently, delays
    compound and timelines stretch unnecessarily. Better
    coordination would materially accelerate the deployment of
    private capital into strategically important domestic capacity.
        Third, urgency. If Congress and the Administration believe
    domestic fertilizer production is critical to American food and
    national security then we should act like it. Every year of
    delay is another planting cycle exposed to fragile supply
    chains and foreign dependency. Projects like ours are ready to
    move. The faster strategic federal support becomes real and
    deployable, the faster new domestic capacity comes online.
        Three years from now, the measure of success will not be
    how many frameworks were announced or how many hearings were
    held. It will be whether new domestic fertilizer capacity
    actually came online in the United States. This Committee has
    the opportunity to help ensure that projects like ours move
    fast enough to matter.
        I am grateful for your attention to this issue, and for the
    bipartisan seriousness this Committee has brought to the
    problem. I look forward to your questions and thank you.
        [The prepared statement of Mr. Westling can be found on
    page 117-123 in the appendix.]
        Chairman Boozman. Thank you very much. We are going to go
    to our round of questions, and I am going to allow Senator
    Thune to take my place in the order. We appreciate the fact
    that even though he is the majority leader he is one of our
    most active Members.
        Senator Thune. Thank you.
        Chairman Boozman. He has not forgotten his roots.
        Senator Thune. Thank you, Mr. Chairman, and you can count
    on that. Thank you again for your leadership on this, and
    Senator Klobuchar, for taking on this issue. Let me add, I
    would be remiss, and I know this is not the subject here, but
    we need to get E15 done. That solves a couple of important
    problems, one of which is demand for corn in this country, at a
    time when we are losing some of our export markets. Secondly,
    increasing the supply of fuel in this country, at a time when
    gas prices are going up. As an economic matter, it makes all
    the sense in the world.
        I deviate, and I understand, and thank you for your
    indulgence on that subject.
        I want to thank all of our panelists for being here today
    and for sharing your thoughts on the impact of fertilizer
    prices and supply chains on the ag economy. These high input
    costs, adverse weather conditions, low commodity provides all
    impact our ag economy, and it is important that Congress
    continue its work toward long-term solutions that support the
    entire ag industry. I am very proud of what we did last summer
    in the Working Families Tax Cuts to increase reference prices
    for ARC and PLC, improve crop insurance protection, and update
    disaster programs.
        I will say there remains more to be done. All of the
    Members of this Committee know that rising input costs have
    been eating into producers' bottom lines over the last several
    years, particularly, I would add, the price of fertilizer. This
    steep increase would shrink or altogether eliminate any
    grower's profit margins, even during times of strong commodity
    prices. It needs to be addressed.
        Mr. Kubik, would you elaborate on how the price you have
    paid for nitrogen and phosphate fertilizer has changed over the
    last several years and how those changes have impacted your
    planting decisions over the last few years?
        Mr. Kubik. Thank you, Senator, for that question. I did go
    back and look. From 2020 to 2026, kind of where the trend in
    fertilizer, I got a little bit of PTSD from 2022, I will be
    honest, and I must have blocked it out of my memory, because I
    cannot believe we paid that much for fertilizer in 2022.
        Just for reference, in 2020, my farm paid $355 for a ton of
    urea. By the time 2022 hit, that price jumped to $830. A little
    bit of retract in 2023 and 2024 to $400 and $500, $600 range,
    which at the time, it does not take a sharp pencil to figure
    out that that is not sustainable, and we cannot be profitable
    at those levels.
        Then when we look at phosphates, so MAP, $435 a ton in
    2020, and it jumped to $1,100 a ton in 2022, and it has stayed
    consistently high. It came off that high of 2022, but stayed in
    the $700 to $800 range consistently for the last four to five
    years. That has changed, and we apply less because of it.
    Actually, in 2025, we did not apply any phosphate on our farm
    because it just did not make economic sense for us. We are
    taking the risk that, hopefully, in the coming years, it will
    get cheaper, and we can catch up.
        We have dealt with this for a long time, and then when we
    have world events that happen, that completely blows that up
    and really exacerbates the problem. We feel it. This has been a
    longstanding problem for us.
        Senator Thune. It predates current events, but
    nevertheless, I mean, this is contributing. This is something
    that is going back a long ways, and there are some structural
    things I think here that need to be addressed, which is why we
    have some of these transparency bills.
        Could you just very quickly share your experience with the
    recent shortages, in particular the shortage of nitrogen in
    South Dakota?
        Mr. Kubik. I will be honest, Senator, we have not
    experienced a shortage of nitrogen yet. For our spring needs,
    the nitrogen fertilizer has been there. A lot of this stuff was
    in place and in country long before the events around the world
    happened. They went up in price significantly, the product that
    was here. We do have a product. We are starting to get
    concerned about what do we in-crop, as our crop is growing and
    needs more fertilizer, and as we look toward 2027. It is a real
    consideration.
        Senator Thune. As we know, there are a small number of
    manufacturers who have the lion's share of domestic fertilizer
    production. I would like to ask this question of Mr.
    Rosenbusch. In the United States, what percentage of sales for
    potash, nitrogen, and phosphorus, respectively, to U.S.
    retailers come from manufacturers other than the largest
    companies?
        Mr. Rosenbusch. Thank you, Senator, for that question. Each
    market is very different, so I will start with potash. Potash,
    only about two percent of our domestic manufactured product,
    represents the market here. When you look at nitrogen, again,
    it depends on each of the different products. Ammonia, we have
    a large percentage of U.S. domestic producers. We have 18
    different companies that make up about 80 percent of that.
    Then, when you get to phosphate, about 60 percent of our
    domestic manufacturers represent the market share in the United
    States. The other 40 percent is imported product.
        It depends on each of those, and when you think about the
    total market for the United States, it is not just the domestic
    produced product, but it is also the imported product that we
    need to serve all the farmers' needs.
        Senator Thune. Mr. Chairman, my time has expired but if I
    can I would like to submit a couple of questions for the
    record.
        Chairman Boozman. Without objection.
        Senator Thune. Thank you.
        Chairman Boozman. Senator Klobuchar.
        Senator Klobuchar. Thank you very much, Mr. Chair. Mr.
    Kubik, in March, Leader Thune and I introduced the bill I
    mentioned that would create a mandatory price reporting system
    for price transparency of fertilizer components. Could you talk
    about how price transparency in the fertilizer market helps
    farmers like yourself gain insight into the market and can make
    informed financial decisions? How is it helpful during the
    current market volatility we find ourselves in?
        Mr. Kubik. Thank you for that question, Senator, and it
    would be huge. You know, we just want to understand this
    market. Time and time again, I have found myself saying it, my
    neighbors saying it, that when the price of fertilizer is so
    high, we keep asking ourselves, why is it so high? You know
    what is going on now? This one little event, you know, a couple
    of months ago, it was easy to point to, but leading up to that,
    nobody knew that answer.
        We just want transparency in that for (a) risk mitigation,
    so we can understand how we purchase our fertilizer, early when
    we do it, the trends, everything else, and just pull back some
    layers to see how our fertilizer, our main component, one of
    our main input components, is priced, and priced to us.
        Senator Klobuchar. Thank you. Mr. Green, you spent some
    time during the last administration looking at competition
    challenges in fertilizer and other input markets. Can you talk
    quickly about some of your findings back then?
        Mr. Green. Well, we did a request for information around
    fertilizer. I gather your question is focused on fertilizer. We
    did a lot of different things on seeds, on cattle, on poultry,
    but on fertilizer, we did a request for comments, and we did a
    summary of that. It was made available. We really found, this
    was in 2002, 2003, so many of the trends you are hearing today
    were entirely present then. These have been building up for a
    number of years, but they are small number of choices, high
    concentration, high prices, prices that follow the price of
    corn rather than the price of the supply and demand for the
    actual product itself, or supply and demand for the inputs into
    fertilizer itself. That really just raises questions. I mean,
    obviously, there are some reasons why it might be connected,
    but the extent of the connection is really a focus of concern.
        We made all of that public, hundreds of comments, and we
    would certainly be happy to share that with your office.
        Senator Klobuchar. Thank you. Thank you very much. Mr.
    Melton, you mentioned the war, and many of our farmers have
    found themselves stuck with higher costs right before the
    planting season, or during it actually, which was reflected in
    your Farm Bureau Fertilizer Survey. Fifty-eight percent of the
    respondents reported that their financial situation has
    worsened this year.
        How are these costs going to affect the next generation of
    farmers that are trying to get started, that maybe do not have
    the margin or the savings of some of our farmers who have been
    around a while?
        Mr. Melton. We have probably seen four years of balance
    sheet deterioration. We have had four years of where prices
    have declined, and basically all of our inputs have gone up,
    but especially fertilizer here.
        It is concerning about the next generation, because they
    probably do not have the balance sheet strength that some of
    our mature farmers, I would say, and it is very concerning.
    Plus, actually talking a young person to getting into
    agriculture right now is concerning to me, because what would
    make you want to do this? I mean, when you are looking at not
    being able to make a profit, or basically not planting the
    crops that you normally plant because of fertilizer prices. We
    have to do something to try to stabilize this market and make
    us more profitable. There are a lot of different things that we
    can do----
        Senator Klobuchar. Agreed.
        Mr. Melton [continuing]. but we have to get farmers back to
    profitability again.
        Senator Klobuchar. Agreed. Thank you. Quickly, Mr.
    Rosenbusch, can you talk more about the unique challenges
    fertilizer companies are facing with these supply chain
    disruptions? You mentioned some things internationally that I
    did not even know about, and I want to quickly get to Mr.
    Westling. If you could be fast. Thanks.
        Mr. Rosenbusch. Yes, thank you, Senator Klobuchar. I think
    I would just summarize it by saying that we are competing as a
    free market in the United States with a significant amount of
    manufactured fertilizer in countries where you have state-
    controlled enterprises. I referenced China with almost half of
    the world's phosphates. When they decide to keep that all for
    domestic consumption, that is what is driving market trends
    more so than any other factor right now, is their internal
    government policies.
        Senator Klobuchar. Thank you. Mr. Westling, thanks for
    being here. I mentioned Senator Marshall and I introduced the
    bill to create a grant and loan program at the USDA to help
    domestic fertilizer companies, getting at some of the concerns
    that your previous witness mentioned, like yours, to get into
    financing. What are the challenges in creating a novel
    fertilizer production facility like Project Meadowlark? Nice
    name, by the way.
        Mr. Westling. Thank you, Senator, for the question. The
    biggest challenges on projects that get to a certain scale are
    the upfront capital requirements, and in this industry, in
    particular, since so few of them built, as I alluded to in my
    testimony, there is a real lack of expertise around it. In the
    case of our project, for example, we will have spent $50 to
    $100 million before we sign some of the major contracts for
    construction. That upfront capital cost to bridge to the point
    where you have got the certainty to be able to execute and give
    certainty to other investors and lenders, I would say is the
    biggest challenge, for sure.
        Senator Klobuchar. Thank you very much.
        Chairman Boozman. Senator Marshall.
        Senator Marshall. Thank you so much, Chairman and Ranking
    Member, for your leadership in this, as well.
        Thanks to the Working Family Tax Cuts Law, crop insurance
    and reference prices have been taken care of, for the most
    part. Now, input costs are the number one issue concerning
    American farmers. In fact, fertilizer costs now account for up
    to 40 percent of input costs. That is now the number one issue,
    these input costs. American farmers are price-takers on both
    ends, paying monopoly prices for inputs. They must buy and
    accept commodity prices they cannot control. With no pricing
    power on either side, that is not a market. It is a trap for
    the American farmers.
        I do point out that prices for fertilizer were higher for
    some 18 months when Russia invaded Ukraine, and those prices
    came down. Of course, now they are up significantly.
        We will speak to Mr. Rosenbusch first. As you know, one
    particular company controls 64 percent of U.S. phosphate rock
    mined, may account for 90 percent of retail sales to farmers.
    It is being reported that this largest domestic supplier of
    phosphate is closing plants, which will reduce domestic
    supplies, while we have a 16 percent duty on Moroccan imports
    on phosphate.
        I guess the other question I would ask you, what are these
    countervailing duties protecting? Aren't farmers not getting
    squeezed from both sides with less domestic supply and
    restricted imports?
        Mr. Rosenbusch. Yes, thank you, Senator Marshall, for that
    question, and really, an interesting topic that I think is
    going to be the hot topic going forward into the future. I
    cannot speak for specific company's business decisions, and as
    you are aware, those are companies that are all TFI members on
    opposite sides of that case. We remain neutral when it comes to
    that specific case.
        Senator Marshall. I am not asking you to comment on their
    plan, but I think you would agree with me that the farmers are
    getting squeezed on both sides now, less domestic supply and
    restricted imports. Does The Fertilizer Institute support free
    market competition and fertilizer pricing? Yes or no. If the
    answer is yes, you have to justify the duties that block the
    world's largest phosphate producer from competing for American
    farmers' business.
        Mr. Rosenbusch. There is no question, Senator, that farmers
    are going through a really difficult economic time, and TFI
    does support policies that promote open, fair, predictable, and
    transparent trading environment. I think when we think about
    phosphate going forward, those two raw materials, to
    manufacture that, are sulfuric acid and ammonia. With the
    sulfur challenges we are now----
        Senator Marshall. We understand all that. We understand
    there is a shortage of sulfur. We need the sulfur to mine the
    phosphate. That is pretty elementary chemistry. I am just going
    to ask you directly. Does The Fertilizer Institute support or
    oppose removing the 16 percent countervailing duties on
    Moroccan phosphate? The farmers in Kansas deserve an answer.
        Mr. Rosenbusch. Senator, I understand how challenging that
    is for farmers because we have member companies that are on
    both sides of that case. We do not take a position on that
    particular case at the ITC right now.
        Senator Marshall. The American farmers paid almost $7
    billion in excess costs over five years because of that 16
    percent countervailing duty. Does The Fertilizer Institute
    believe American farmers should pay above market prices to
    protect a single company's market position?
        Mr. Rosenbusch. Senator, we definitely believe that farmers
    need access, and TFI member companies are committed to ensuring
    they have supply, and that that supply is in line with what
    global markets are. In many cases we have seen that the U.S.
    market is actually traded at a bit of a discount right now,
    almost $150 cheaper than what Brazil pays for their phosphates.
    That commitment that I think the U.S. fertilizer suppliers have
    is to the farmer, to get an affordable and abundant supply of--
    --
        Senator Marshall. Mr. Rosenbusch, would you agree that the
    American farmers deserve access to the lowest cost, highest
    quality fertilizers available, regardless of where it is
    produced?
        Mr. Rosenbusch. Thank you, Senator. We 100 percent agree
    that fertilizer manufactured and bolstering domestic supply of
    fertilizer is incredibly important to deliver to U.S. growers
    the fertilizer they need in order to be profitable.
        Senator Marshall. I just want to reiterate that the number
    one challenge for the American farmer today is input costs, and
    fertilizers now account for up to 40 percent of those input
    costs. Look, trade exports are up. We went from 2.3 to 2.8
    billion bushels of corn last year. We are going to have a 20
    percent increase in corn and ethanol exports again this year.
    The problem are the input costs, and the fertilizer is the
    biggest chunk of those that we need to address. I appreciate
    again the Chairman and Ranking Member for giving us this
    opportunity to discuss these. We have been working on these,
    again, since Russia invaded Ukraine, and we need to give the
    American farmers some relief now. Getting rid of those
    countervailing duties would be the quickest, most immediate
    impact that the American farmer could see in their real world
    today.
        Thank you, Mr. Chairman.
        Chairman Boozman. Thank you. Senator Smith.
        Senator Smith. Thank you, Mr. Chair and Ranking Member, and
    thanks to all of our panelists today. I want to actually maybe
    follow up a little bit on Senator Marshall's questions, because
    I think he is touching on something that everyone on this
    Committee cares about.
        You have got these skyrocketing input costs, and we also
    have what we know to be really significant market
    concentration, and on the input side we are talking about
    fertilizer today. I think, actually, Mr. Kubik, you put it
    really clearly. You said basically the fertilizer companies
    raise their prices because they can. That is the market power
    that they have.
        You know, I was just looking at some data, which gets at
    this, and I am going to just come to you first, Mr. Kubik,
    because I think this is really interesting. This data is a few
    years old, so it is maybe prices that were in global markets
    were more affected by what is going on in Ukraine, but I would
    ask everyone, do we really think it is different now than it
    was? This is from the Institute for Ag and Trade Policy in
    Minnesota.
        They said that in the 2021-2022 time period the nine
    largest fertilizer companies made an estimated $84 billion in
    profits. In 2022, major fertilizer companies saw profits
    increase by somewhere between 100 and 200 percent. Their input
    costs did not go up by that much.
        Think about that, Mr. Kubik. Their profits are going up
    between 100 and 200 percent. How much do you think the profits
    of the average farmer in South Dakota was going up during that
    time period?
        Mr. Kubik. Thank you for that question, Senator, and
    bringing light to it. I can tell you personally----
        Senator Smith. Yes.
        Mr. Kubik [continuing]. they have not gone up by 100 or 200
    percent. That is why we struggle with it. I look at my cost of
    production. When I look at marketing my corn or my soybeans or
    my cattle, and that is how I determine my marketing points.
    That is why we kind of feel taken advantage of. They can look
    at their cost of production and throw it out the window and
    just look at a price to set it at.
        Senator Smith. Yes, that is the price that they can charge
    because, as you said, they have the market power. Mosaic's
    profits in that time period went up 120 percent. Nutrien's
    profits went up 142 percent. I mean, that looks like excess
    profit to me. Did you want to add?
        Mr. Kubik. If I may. I believe that there is a copy of the
    article at all of your desks. This is not just two, three and
    four years ago. This is like in the last week we have similar
    reports of massive profits. That is the thing that we feel the
    worst about, is during this last 75 days a lot of money was
    being made, but it was not by farmers.
        Senator Smith. I always say when I am talking to Minnesota
    farmers there is plenty of money in agriculture. The question
    is who is getting it. It is not farmers right now.
        Now, I am fully in support of the excellent transparency
    bills that have been put forth, bipartisan by my colleagues. I
    am wondering, Mr. Melton or Mr. Kubik, or anybody who wants to
    comment, do you think that those transparency laws, if they
    were in place right now, do you think that would change the
    behavior of these companies? Because that is what we are
    talking about. We are talking about the behavior that they have
    of being able to raise prices so exorbitantly.
        Mr. Melton. Well, thank you, Senator. I think we need all
    the tools in the toolbox that we can use, anything that we can
    do to help us get back to profitability. I go back to we have
    seen four years of decline in our balance sheets. This cannot
    continue on. You cannot keep losing money and continue with the
    things that we are doing. I think we need every tool in the
    toolbox that we can use. I think transparency in markets will
    give us one tool there that we can use.
        What we do right now, and I talked to my partner this
    morning about it, we get a lot of our information from the
    retailer. That is where we get our information on fertilizer
    right now. I mean, there are things on the internet you can go
    look to, but actual fertilizer pricing----
        Senator Smith. To be able to actually see.
        Mr. Melton [continuing]. we have to go to the retailer
    right now to see where we can price that fertilizer. I think it
    would be a good tool in the toolbox.
        Senator Smith. Mr. Green, would you like to comment on this
    issue that I raised about the exorbitant profits that we are
    seeing? I know you work a lot on the question of how we can
    have fair markets in agriculture to the benefit of the folks
    that are actually growing things.
        Mr. Green. I mean, I want to agree with my colleagues here.
    You need a lot of toolkits. There is no one toolkit that will
    bring those down. When you do have those supernormal profits,
    you need to go back and look at the mergers and look at the
    other conduct and bring enforcement cases. You have to think
    about the transparency toolkit. You have to think about the
    investment toolkit of supporting the new competition, the new
    choices, which is what we did in the previous administration,
    $778 million of investments.
        Every single one of those is part of bringing down those
    supernormal profits, which are an indication of a broken
    market.
        Senator Smith. That is exactly right. I agree with that
    completely. I know my time is up, Mr. Chair. I think the
    question is, what can we do to change the behavior of companies
    that are in a position where they can charge such high prices
    and get such exorbitant profits? I mean, in some sectors we
    look at things, I know it would be radical, but things like a
    windfall profits tax, something to change the behavior so that
    we can make the market more fair, particularly for the folks
    that are doing the work. Thank you.
        Chairman Boozman. Thank you. Senator Grassley.
        Senator Grassley. Before I ask Mr. Kubik the first
    question, I want people to know that there is at least one
    other Senator who agrees with the questioning that Senator
    Marshall put forward. In 2021, countervailing duties were first
    applied to Moroccan phosphate. A study published at Texas A&M
    in January found that farmers paid nearly $7 billion in
    additional costs between 2021 and 2025 growing seasons because
    of countervailing duties. One company, Mosaic, has 80 percent
    of the market in the United States, yet they feel like they
    need protection from 18 percent tariffs on Moroccan phosphate
    coming into this country.
        Trump has tried to help with dollars from the U.S.
    Treasury, but what I hear, even last week, in 12 different
    counties in Iowa that I toured, farmers want to get their money
    from the marketplace, not from the U.S. Treasury.
        I think this administration ought to get rid of that 18
    percent tariff on Morocco phosphate. Lowering production costs
    would be as much help as increasing prices for farmers or
    getting money for the Federal Treasury.
        Now, Mr. Kubik, for many years now, farmers have felt that
    when commodity prices increase, input prices are bound to
    increase with them. Since 2020, even as the price of corn has
    decreased, fertilizer prices have remained elevated. We know
    the talking points of the fertilizer industry. The cause would
    be Ukraine, Chinese export controls on fertilizers, all
    contributing to prices farmers are facing and increased prices
    those are. However, farmers have also been seeing increased
    consolidation of the fertilizer industry. Farmers want to know
    exactly why they are paying the price that they have for
    fertilizers, and I think we need more transparency on that.
        For you, Mr. Kubik, as a consumer of fertilizer, how much
    insight do you have into the price of the fertilizer you use?
        Mr. Kubik. Yes, thank you for the question, Senator, and I
    will echo what Eddie said. We get a lot of that from our
    retailer, and our retailer gets a lot of that from the
    wholesaler, and we are just kind of going off of things we hear
    in the news and then coming to them. We are still big on the
    fertilizer transparency, the Fertilizer Research Act that you
    introduced. We just need to see more data and see more trends.
        We like to typically purchase our fertilizer in the summer
    prior to the growing season, so this summer, a lot of farmers
    will be purchasing fertilizer in June and July for the next
    growing season. Now we have a lot of uncertainty. Is that trend
    going to remain the same? We just do not have a lot of that
    data to look at.
        If we can just see a lot more of that. Even if it is too
    high and we think it is too high, at least we know how and why,
    and predict a little more what it is going to do.
        Senator Grassley. My second question, I think you just
    addressed, but more transparency, and knowledge, and data on
    fertilizer prices would be very beneficial to you.
        Mr. Kubik. It would be huge, yes. As one piece that was
    mentioned before, it is one piece of the puzzle trying to
    figure out this market.
        Senator Grassley. Yes. Maybe this next question is
    difficult for you to answer, but is there any reason you can
    think of that the fertilizer industry may not want a study to
    be published by the U.S. Department of Agriculture?
        Mr. Kubik. Not one that I can think of, and I actually
    heard comments today they are very supportive of transparency,
    which is nice to hear that they support that. It sounds like,
    well, you know, with their support and our support, hopefully
    we can get these bills across the finish line and start getting
    and collecting this data.
        Senator Grassley. Mr. Rosenbusch, does The Fertilizer
    Institute support a report that provides insight to farmers on
    why they have paid certain prices for fertilizers, including
    factors such as market concentration?
        Mr. Rosenbusch. Senator Grassley, thank you for that
    question. Good to see you again. We had some of these
    conversations a few months ago when you chaired the Committee.
    Yes, we do support transparency. We think farmers need more
    information to understand markets and prices, and we believe
    that USDA can play a very important role in being able to
    explain that.
        I was at a farm on Friday, talking to some growers about
    the dynamics, the global dynamics, what was creating the price
    structure we have today, and they were very appreciative of
    that. I am one person, and I think the more we can do to invest
    in providing that market information, the better it will be for
    growers to make those decisions.
        Senator Grassley. My time is up, Mr. Chairman. I will put
    the rest of my questions for answers in writing.
        Chairman Boozman. Thank you, Senator Grassley. Senator
    Lujan.
        Senator Lujan. Thank you, Mr. Chairman. Thank you and the
    Ranking Member for calling this hearing. To all the panelists,
    thank you all for being here.
        Last week, I had the opportunity to sit down with some
    farmers and ranchers in southern New Mexico and just ask them
    what is working, what is not working, what is happening to your
    bottom lines. A host of issues they shared with me--increased
    farm input costs, shortage of farm labor, concern with an aging
    farming population, loss of expertise at USDA. Someone said
    that it is hindering their ability to get timely assistance
    from the United States Department of Agriculture.
        Now, many of the issues are larger than one administration.
    I recognize that. However, some of the issues can be directly
    attributed to policies advanced by this President and by this
    Administration. President Trump began by implementing sweeping
    tariffs that have closed off entire markets to American
    farmers, markets, and relationships that we spent decades
    building, driving down prices just as farmers across the
    country are headed to the field to harvest their crops.
        President Trump then started a war in Iran, I would argue
    an illegal war, without seeking congressional approval. As a
    result, the Strait of Hormuz is now closed, which has caused
    fertilizer prices around the world to skyrocket. While all of
    this was happening, President Trump's Department of Agriculture
    implemented sweeping reduction-in-force efforts. It is hard to
    find inspectors anymore to go in, if you are able to get
    approval or a stamp to sell your stuff, and we cannot seem to
    agree that empower colleges across the country that are ag
    institutions, that when there is not a USDA inspector available
    there should be someone from the state available, whether they
    are going to look at crop yields or they are going to look at
    what is happening with drought for insurance. We are just going
    to get a stamp so that they can sell their products. I really
    do not understand that.
        With the loss in institutional knowledge and talent at the
    agency, it creates more of a backlog, on top of all the
    pressures that I was just sharing.
        Mr. Rosenbusch, I guess a yes-or-no question. Let me just
    start with this one. Yes or no, is President Trump's war in
    Iran directly related to the spike in fertilizer prices we have
    seen since February 2026?
        Mr. Rosenbusch. Senator, thank you for that question, and
    we have seen significant impact on the global fertilizer
    markets because of the events in Iran. There are many, many
    factors right now that are at play on a global scale that are
    really driving what these markets are, whether that be what
    India is doing with their purchasing power right now or what
    China is doing to restrict exports.
        Senator Lujan. I am not a lawyer, but is that a yes?
        Mr. Rosenbusch. Senator, I----
        Senator Lujan. If you are not going to say yes or no, I
    will just point to the first bullet on your filed testimony.
    The answer is yes, and you justify it on the first bullet on
    page 10 of your testimony. It is not a gotcha question.
        What is harder on Congress these days is stipulating to a
    set of facts. You bring yours, I bring mine, and then we fight
    about them, and there are no facts. What this war in Iran is
    doing to the cost of fertilizer is bullshit. Maybe we should
    just be talking about the kind of fertilizer that comes out of
    cows and sheep. Maybe we should be using some more of that in
    America. Figure it out.
        You all do not come in here and tell me that the people
    back home are full of shit. I do not understand that, man. The
    cost is the cost. Implements are more expensive because of
    tariffs. I am not going to ask the Republican witnesses that
    because I am going to get some academic justification on why it
    is just my imagination. When I went to put in diesel this week,
    I guess it was just my imagination that I was paying over $5.50
    a gallon. I am one of the few Senators here that probably puts
    diesel in a truck and a tractor.
        I have a lot of questions to file, Mr. Chairman. I am sorry
    I got distracted here. We just want a straight answer, man.
    Farmers and ranchers across the country are hurting. You know
    this. Whether it is a Democrat or a Republican, whenever an
    administration is doing something that is punitive to the folks
    that we have a responsibility to fight for, then let's speak
    up. I will call out Dem Presidents the same way I am going to
    call out a Republican President.
        I grew up as a self-sustenance farmer. I did not know we
    were poor when I was growing up because we always had good
    food. We had lamb chops, fresh chile, tomatoes, and apples.
    Sometimes Mom even made an apple pie. I am still one of the
    Senators that shakes the milk when I buy it, because we had
    milk delivered when I was a kid, and it is the way that you got
    the cream from the top into the rest of the milk. My buddies
    laugh at me, and they say what the hell am I doing.
        I am sorry for vernacular that I am using, Mr. Chairman,
    but sometimes when you grow up on a little farm, and you have
    to shovel shit in the morning to keep the barns clean, we need
    to talk that way over here so we can connect. We can do better
    here, and I certainly hope that we can get a farm bill, that we
    can work together, that we do not let basic arithmetic get in
    the way of what it means, because it takes 60 votes to get it
    done. Let's work together to get things done here.
        All that I would ask for the panelists, whether we meet
    individually or not, let's just be straight with each other,
    you all. We do not need to sugarcoat stuff. People are hurting
    today. Let's recognize that, and then let's agree to find some
    solutions to make things better.
        Thank you for the indulgence.
        Chairman Boozman. Thank you. Senator Fischer.
        Senator Fischer. Thank you, Mr. Chairman. Mr. Westling, can
    you take just a minute to discuss the project that you are
    doing in Gothenburg and maybe highlight some of the challenges
    that you face.
        Mr. Westling. Yes. Thank you, Senator Fischer, for the
    question. The project that we are doing is to make a fertilizer
    type that is utilized in that region or geography in the State
    of Nebraska, born from the shortage that exists there and the
    difficulty of transporting product there over sometimes huge
    distances.
        In terms of the challenges faced, like every large project
    that is not done by an incumbent or somebody with a big balance
    sheet it is upfront capital and raising capital to get those
    projects off the ground. I am fortunate and thankful for the
    mostly farmers who stepped up to the plate to fund this project
    and/or to fund the early stages of the project.
        Senator Fischer. You know, we are hearing some discussions
    around federal investments. What types of safeguards do you
    believe should be put into place to ensure that new
    infrastructure projects that happen, that they are not going to
    be resold, which Senator McConnell talked about that he was
    able to work on, or contribute to consolidation, which is what
    I hear from producers. I am sure you do out in the western part
    of the state, too, hear from producers. They are worried about
    that consolidation and what it does to price. Do you have any
    thoughts on that?
        Mr. Westling. Senator Fischer, I am certainly not an
    attorney and I will not pretend to know how to write bills. I
    will leave that to all of you, much smarter than I am. I would
    like to think that there is a way, through whatever form
    potential assistance comes in, for you to be able to create
    those exclusions or prohibitions from trading or consolidating
    or putting these types of projects in the hands of whomever you
    do not wish for them to be in.
        Senator Fischer. Do you worry about regulations, federal
    regulations, local regulations? Have you had to deal with any
    of that?
        Mr. Westling. Senator Fischer, we have had some regulations
    that we have had to deal with, not any different from most
    projects of this scale. We have been relatively fortunate in
    that in our state, the folks who are in charge of administering
    those regulations or enforcing those regulations have all been
    very reasonable to work with. To the extent at the federal
    level where we needed them to weigh in, again, blessed by the
    fact that those folks have all been very reasonable to work
    with, as well.
        Senator Fischer. That is good to hear. Thank you.
        Mr. Rosenbusch, as many of my colleagues have shared,
    fertilizer availability and the prices are the forefront of
    every farmer's mind across the country, and that includes my
    friends in Nebraska. For years the United States has been
    reliant on foreign fertilizer production to meet that domestic
    demand. With a lot of talk around the need to increase that
    domestic production, can you share the current regulatory
    challenges existing companies face when they tried to onboard a
    new fertilizer facility in the U.S.?
        Mr. Rosenbusch. Thanks, Senator, for that question. Josh
    did an outstanding job of explaining that.
        Senator Fischer. Do you feel that it is pretty good to be
    able to deal with?
        Mr. Rosenbusch. It is really hard to build new capacity in
    this country. One recent ammonia plant took seven years to
    permit and over $25 million, just to permit it, not even to
    start construction. We are talking $4 to $5 billion dollars of
    capital. A phosphate mine took over a decade and $32 million
    just to permit. That is all about the federal permitting
    process across multiple agencies. When you think about actual
    production itself, once you get into production, the regulatory
    challenges that add the cost to manufacturing, you have got
    phosphogypsum, which is a byproduct of phosphate fertilizer
    that has to be stacked and costs over $1 billion a year just to
    maintain those stacks.
        There are a long list of regulations that we would be happy
    to share with you, of things that can be done to help bolster
    domestic supply.
        Senator Fischer. Thank you. Mr. Kubik, so nice to see you
    here. Can you take a minute to discuss the role that precision
    agriculture has, that new technology that is out there, and the
    increased approval we are seeing in the bio-based products that
    they can have in providing additional options to growers, to ag
    producers, that are faced with the uncertainty they have now
    with fertilizer.
        Mr. Kubik. Yes, thank you, Senator, for that question. This
    is something I am very, very passionate about.
        Senator Fischer. Me too.
        Mr. Kubik. Yes, coming out of college with an agronomy
    degree and always looking to better ourselves. I think that
    could be said for all farmers. We are all trying to do what is
    best for the land because we want our kids and our grandkids to
    farm on that land. This fertilizer costs a lot, so we cannot
    just throw it on and waste it and kind of hope it got there
    right.
        We are very precisely applying it. We are variable rate
    applying it, so parts of the field are getting more than
    others, based on our soil testing, to make sure we are doing
    everything exactly like we should.
        The biological space has definitely garnered a lot of
    attention over the past couple of years with the increase in
    fertilizer. I will be trying a couple of different ones on my
    farm. I have tested multiple different ones on our farm. The
    problem with that, unfortunately, though, Senator, we live in
    reality, and there are not enough right now to rely on. We
    still need fertilizer to grow our crops, and we are hopeful. I
    dream of a day where I do not need commercial fertilizer
    anymore. That would be the best thing ever. I do not know if my
    grandkids will experience that. If we can put on less, put it
    on accurately, I think it does good for both sides.
        Senator Fischer. Thank you. Thank you, Mr. Chairman.
        Chairman Boozman. Thank you. Senator Warnock.
        Senator Warnock. Thank you very much, Brother Chair.
    Brother Chair, I'm sure you know that the top state for farm
    bankruptcies last year was your home State of Arkansas. The
    number two state was Georgia, so we are dealing with this same
    issue. I am sure the Chair and I agree that while we like to
    see our states leading, we do not want to be leading in this
    way.
        In fact, farm bankruptcies increased by 46 percent last
    year, due largely to the President's trade war, and I wonder
    how many more farmers may go bankrupt by the end of this year
    because of President Trump's war in Iran, a war that is raising
    fertilizer and fuel costs, as we all know, due to the closure
    of the Strait of Hormuz, which anyone paying attention could
    have predicted.
        Mr. Rosenbusch, the President's war in Iran has further
    increased fertilizer prices for farmers in the United States.
    You are the CEO of The Fertilizer Institute, the trade
    association representing the companies that provide farmers
    with fertilizer. Has the White House presented you with a
    viable plan for bringing down fertilizer prices this year?
        Mr. Rosenbusch. Senator, thank you for that question, and
    we have been very engaged with discussions on Capitol Hill,
    with the Administration, on really an all-government approach
    to solutions to help mitigate the impacts of the closure of the
    Strait, what we can do to prioritize domestic supply, what we
    can do to incentivize projects like Josh's, to bolster more
    domestic supply, so these supply shocks will not hurt the
    farmer in the future when we are so reliant on some of these
    foreign supply sources around the world.
        Senator Warnock. Do you expect fertilizer prices to go down
    this year?
        Mr. Rosenbusch. Senator, that is a really interesting
    question. I do not know that I can comment or legally predict
    what is going to happen to the price of fertilizer. I will tell
    you that we are very concerned about particularly phosphate,
    with a $1,000-plus sulfur right now due to the restriction of
    sulfur coming through the Strait. We are now at a point where
    sulfur costs alone are significantly higher than the cost of
    phosphate. You have seen around the world right now phosphate
    mines around the world starting to curtail production because
    of some of that price impact.
        Senator Warnock. Same question for the rest of the panel.
    Has anyone seen a viable plan from the White House that gives
    them confidence that fertilizer prices will decrease in the
    near term? No takers. Fertilizer prices are increasing. Diesel
    costs have also increased by over $2 a gallon compared to this
    time last year, and there is no end in sight.
        Mr. Melton, you are the President of the Kentucky Farm
    Bureau, so you know farmers in the South typically do not pre-
    purchase their fertilizer and are more subject to price
    volatility. What are you hearing from your members? Are they
    able to afford fertilizer this planting season?
        Mr. Melton. In Kentucky we got an early start this year,
    and most of the crop has already been planted this year in
    Kentucky, Senator. I can tell you that, and especially on our
    farm, we did more intensive soil testing and applying
    fertilizer where we had to, without trying to reduce yields. I
    think that is across the South. I think a lot of people are
    doing those things, trying to get more creative to where we can
    try to pencil out a profit with where current prices are for
    our commodities.
        Senator Warnock. People are feeling the affordability
    pinch, obviously, right?
        Mr. Melton. People are cutting back usage on fertilizer on
    their farms. Yes, sir.
        Senator Warnock. Dealing with the uncertainty as best they
    can. This uncertainty hits farmers at the worst possible time,
    planting season. It is not a good time to be dealing with this.
    I am not hearing from anyone here that the White House has a
    plan that will solve this crisis for farmers. Dialogue is one
    thing. A plan is another. At this point, the best-case scenario
    for farmers is the reopening of the Strait of Hormuz, which was
    opened before the war started. Even then, the fertilizer market
    will not bounce back overnight if it were to open tomorrow. You
    will still be dealing with these prices.
        Between the war in Iran, spiking fuel and fertilizer
    prices, and the illegal trade wars increasing the cost of
    equipment and limiting market access, it is no wonder that
    farmers in Georgia I talk to say that they cannot take much
    more, and we are dealing with this farm foreclosure crisis. As
    a Member of this Committee, I will continue to fight for
    farmers and doing everything I can to end this illegal war in
    Iran and unfreeze our fertilizer and fuel markets.
        Thank you very much to the panelists. Thank you, Mr. Chair.
        Chairman Boozman. Thank you. Senator Hoeven.
        Senator Hoeven. Recently, I had an opportunity to get
    together with Secretary Rollins as well as our Chairman,
    Senator Boozman, and talk about both short-term and long-term
    efforts to reduce fertilizer prices. One of the ways we are
    doing that is with precision agriculture. As a matter of fact,
    Brian Carroll is here with us today from Grand Farm, in the
    audience, along with Greg Tavine. Grand Farm in North Dakota
    was recently named as the manager for the National Proving
    Grounds and the actual first proving ground, or test site, for
    ag technology to develop precision ag in a way that helps us
    actually accomplish the same by using less inputs, meaning less
    chemical, less fertilizer for our crops.
        That is exactly the kind of work Grand Farm is doing in
    conjunction with ARS, and North Dakota State University, and
    NIFA funding. That has an impact both in the short term and the
    long term because basically you get the same result with less
    fertilizer. I would like to hear from both Mr. Kubik and Mr.
    Melton on how that can make a difference for farmers and what
    kind of things need to happen so that farmers can utilize that
    technology both now and in the future. Starting with you, Mr.
    Kubik.
        Mr. Kubik. Thank you, Senator, for that question. I think
    in terms of what we can do, a lot of farmers are already using
    it, especially in fertilizer application. Many of us get our
    fertilizer applied by our retailer, and those retailers are
    using state-of-the-art machines, they are using, again, like I
    said, variable rate technology, and it is all a goal of ours to
    use less fertilizer, or to maximize the efficiency of our
    fertilizer use, something my farm did last year, where we
    learned that with a little bit of rain we can lower the amount
    of nitrogen we need to grow a bushel of corn. I think that is
    key.
        I do not know if we are necessarily using, on whole, a lot
    less nitrogen. We are just more precisely placing it where it
    needs to be. Ultimately, that is our goal, and a lot of that
    equipment, precision technology, is in the field today.
        Senator Hoeven. Mr. Melton?
        Mr. Melton. Thank you, Senator. I think research and
    development is probably one thing, and you brought up your
    university. I think our university does an outstanding job of
    doing research on projects, like they are talking about in your
    state. I think that we have to continue to do research and
    development into these technologies, and while I am thankful
    that I have some younger folks on my farm that can help apply
    these technologies, because some days I have trouble starting a
    tractor sometimes now. I am thankful that we do have the
    research and development from the universities and the land
    grants that can do these projects and work on technologies that
    can be brought to us, to where we can get more efficient into
    the future.
        Senator Hoeven. Yes. Well, Mr. Melton, you may have a
    little trouble with some new technology, but they like the fact
    that your labor, and they probably do not have to pay too much
    for it. I am guessing you volunteer.
        Mr. Melton. No, I do not volunteer, but they do tell me
    sometimes when I am there, I think some of the jobs I get are
    not the most prestigious jobs anymore. Yes, it is good to do
    it.
        Senator Hoeven. Mr. Westling, in North Dakota, we also have
    the Dakota Degasification Company that now takes coal, converts
    it to natural gas, and then converts it to fertilizers like
    ammonia and urea. How do we get more of that going so we get
    our fertilizer here at home, and we have more competition and
    lower prices rather than getting it from Indonesia or Russia or
    someplace where it is high-priced and a lot of transportation
    costs?
        Mr. Westling. Yes. I think the question was asked earlier
    about the plan from whomever, be it the White House, the USDA,
    or whichever agency wants to take it on. Maybe I am just
    simple, but I think the plan, in my brain, is if the demand is
    going to be there, and it is, increasing supply, right, because
    that should lower the costs.
        Senator Hoeven. Demand is there.
        Mr. Westling. Demand is there. I think some of the ideas
    that I alluded to earlier with incentivizing these projects on
    the front end of this process, helping bring capital, to bring
    additional certainty, certainly when the government leans in,
    everybody else leans in too. Those types of things could and
    should incentivize folks to build more of these projects, no
    doubt.
        Senator Hoeven. You would agree we need to do more of it.
        Mr. Westling. I absolutely agree we need more of them. The
    farmers have invested in my project do, as well.
        Senator Hoeven. We appreciate your project, as well, in
    Nebraska. Mr. Rosenbusch, what do we do in the short term to
    get more competition and fertilizer prices down?
        Mr. Rosenbusch. Thank you, Senator, and it is an excellent
    question. It is really difficult right now when you have got
    countries all over the world that are driving up the price by
    subsidizing and paying high prices. I do agree with Mr.
    Westling, the Administration has done some things to
    incentivize bolstering domestic supply, and we need that,
    whether it is permitting reform. Some of the equipment that is
    required to build plants, such as his in Nebraska, has to be
    imported, so there are currently tariffs on some of those
    pieces of equipment that have to come in, driving up the cost
    of construction. Then the little things like hours of service
    exemptions, to make sure that we can get fertilizer delivered,
    prioritizing fertilizer for domestic supply, which is also on
    the back of delaying some of the plant turnarounds, to make
    sure we are optimizing supply coming out of the existing
    plants.
        Senator Hoeven. Thank you.
        Chairman Boozman. Senator Welch.
        Senator Welch. Thank you very much for this excellent
    hearing. I just want to compliment the witnesses. It is very
    instructive, and I appreciate the information you are providing
    to us.
        We are in a crisis in American agriculture. There is an
    immense amount of wealth that is being created by the farmers.
    They are just not getting any. Let me just illustrate that
    point by a report from our Department. The average loss for
    rice is $220 an acre, for cotton, $202 an acre, for oat, $159
    an acre, for peanuts, $131 an acre, for sorghum, $91 an acre,
    for corn, $87 an acre. This is not sustainable.
        Doing some of the things that Governor Hoeven was talking
    about, precision agriculture, things that are within the
    control of the farmers, they are doing that every single day
    and figuring out ways to do it. If we have this inability to do
    any control over what the input costs are, and they march up,
    step by step, as the price of corn goes up or the price of oats
    goes up, the farmer is totally at the mercy of a market that is
    consolidated.
        Mr. Kubik, you talked about consolidation, and I was
    impressed, with all of you, really, how long and how specific
    you are. That is an issue that we have got to deal with. You
    can deal with precision agriculture and try to figure out the
    best practices, and you have got your own incentive to spend as
    little as possible. What about consolidation, where it would
    take some federal action to deal with the impact of
    consolidation? You see that as a real impact on your pricing,
    right?
        Mr. Kubik. Yes. Thank you for that question, Senator, and
    100 percent, and that is one thing I wanted to emphasize, is
    that the Federal Government is the one that has the ability to
    go in and look at this. We do not as the South Dakota Corn
    Growers Association. We do not as individual states. I think
    the Federal Government has the most power.
        Senator Welch. Do you see that as beneficial to farmers,
    and it does not matter whether they are Republican farmers, or
    Democratic farmers, or independent farmers. They like to do the
    work they do. That is what they are about, right?
        Mr. Kubik. Correct. All we ask for is just to purchase our
    inputs in a competitive market.
        Senator Welch. All right. What about transparency? Mr.
    Chairman, why don't we pass the Thune bill? I mean, the
    transparency seems to be something all of you believe,
    including you, Mr. Rosenbusch, that transparency is good. Does
    anybody have a problem with us moving out and passing the
    Thune-Klobuchar bill? All right, good. I would like us to do
    it, and like right away. We have got to help these guys.
        Now, on small-scale farmers, it is really, really brutal,
    as well. We are seeing consolidation among farmers, as well,
    but that is not to drive profit. It is because of the smaller
    farmers cannot sustain themselves when they are losing this
    much per acre. Mr. Green, just talk to me about that. You know,
    I was on the Nitty Gritty Farm in Charlotte, Vermont, eighth
    generation, and they have got two kids, hoping for the ninth
    generation. By the way, all the farmers I know, they just love
    the idea of passing that farm on to their kids. Tell me about
    that issue.
        Mr. Green. Well, the challenge is that a lot of farmers and
    ranchers face, whether it be farmers in your state or farmers
    in other places, is no matter how big they are, they are still
    much smaller than the processors and the retailers that are
    downstream from them. Their ability to negotiate fair prices is
    very limited. They are price takers. In fact, some of the
    processors themselves are price takers versus the retailers. We
    have got a system where the consumer is paying more, the farmer
    is getting less, and the folks in the middle are getting the
    benefits of all the hard work that are being done. That is
    where the focus needs to be.
        Senator Welch. I want to go back. I believe the Iran war,
    it is not me believing it, it is incontestable that it has
    raised prices. Diesel is way up, and that is a big use on the
    farm. Fertilizer is way up. What I have heard from you is that
    has intensified what is a preexisting problem with the
    consolidation, the high prices, and the really tight margins
    that our farmers are facing. Is that correct?
        Mr. Green. Yes. Absolutely, sir.
        Senator Welch. All right. Well, I just want to thank you
    for your persistence and advocacy on behalf of the people that
    are close and near and dear to you. Rural America is really
    critical to the well-being of all of America, Mr. Chairman, and
    I think we have to act. This Congress has to act. You run a
    bipartisan Committee, and everything I have heard from this
    affects farmers, regardless of what their political affiliation
    is. I hope we move that Thune bill and Klobuchar bill, and I
    hope we do everything we can on consolidation and transparency.
        Chairman Boozman. I hope we can act with this and several
    other things and get a farm bill passed.
        Senator Welch. Thank you. Thank you all.
        Chairman Boozman. Senator Moran.
        Senator Moran. Chairman, thank you. Please know that I join
    you in your efforts to combine maybe a few things, but get a
    farm bill done. It is hugely important, and another opportunity
    for us to provide some certainty to our farmers at home.
        Gentlemen, thank you for your testimony. I have been
    chairing my own subcommittee while this has been ongoing, but
    it is a hugely important issue. I have represented Kansas
    farmers and producers for a while. I see this as the most
    challenging time that my farmers in Kansas have faced since I
    have been a public official. It is, in part, due to five years
    of drought, that is not over yet, and so we begin the financial
    circumstances of most farmers at home in very difficult
    circumstances without the financial capability to weather
    another storm. I am very interested in trying to determine if
    there is a legislative fix to lots of market forces that go on
    that are bigger than just this one issue.
        Mr. Rosenbusch, I read your testimony and noted that you
    talked about rural fertilizer and fertilizer components. There
    is a science that goes into understanding fertilizer, which
    this hearing has helped me better understand. It is not just
    one component. It is related to so many other items that are
    necessary. The closure of the Strait of Hormuz was probably not
    a circumstance that my farmers predicted, and as a significant
    result related, as I understood your testimony, to the world's
    sulfur supply, and 20 percent of the world's supply of
    liquified natural gas.
        As sulfur is a key component of phosphate production, would
    it be fair to say that global phosphate access has been
    affected by the closure of the Strait? That is true, Mr.
    Rosenbusch?
        Mr. Rosenbusch. Senator, thank you for that question. I
    appreciate your understanding of the complexity of the markets,
    which is one of the reasons why we support transparency,
    because it is really difficult to track all of these different
    commodities and the markets for them. Without a doubt, sulfur
    is a big issue right now. We have the spot market trading as
    much as $1,300 a metric ton, and a lot of that is getting
    bought by Chinese for mining. When you look at copper that
    might be $16,000 a metric ton to sell, that is where the free
    market is going to take a lot of that product, as opposed to
    into fertilizer production. This is going to continue to be a
    challenge going into the 2027 crop year.
        It is a bit of a double-edged sword in that we need supply.
    We definitely support the idea of bringing more supply to the
    U.S. farmer. I was looking at some of the numbers. We have 108
    companies that supply nitrogen to the United States. We have 38
    companies that supply phosphorus to the United States, 16
    companies that supply potash. The double-edged sword is that
    you then expose yourself to some of these geopolitical events.
    We need to boost domestic production but also find
    opportunities to continue to find reliable global sources.
        Senator Moran. One of the things that would be useful, I
    suppose, in theory, is a tariff to encourage domestic
    production, but a tariff also then increases the price of the
    inputs, and have we seen any increase in domestic production?
        Mr. Rosenbusch. Yes, it is a difficult question, Senator. I
    appreciate you raising what is a very challenging topic,
    because long-term, when you start to put non-free market
    measures in place from a policy perspective, we understand that
    is going to actually have a worse consequence on supply for the
    United States. We saw that just with Venezuela recently, where
    we now have opened up that market, but that product is going to
    go to wherever the farmer is going to pay the most, which is
    Brazil right now. If we artificially impact the U.S. market, we
    are not going to be able to track supply here in the future.
        Senator Moran. Why are we being outcompeted? Why is
    somebody else more capable of paying the higher price?
        Mr. Rosenbusch. That is a good question, Senator. It is
    one, because you have foreign governments that are driving up
    the price of that through subsidies. I just heard recently
    Ethiopia is bidding for a very limited supply right now, and
    India is paying nearly $1,000 a metric ton that they subsidize
    to farmers. There is your floor price. That sets the global
    market price right there.
        Senator Moran. While I focused a moment on tariffs, there
    is also this other distortion of moral markets in which foreign
    governments are subsidizing their farmers in a way that then
    disadvantages U.S. farmers.
        Mr. Rosenbusch. That is going to attract global supply at
    that particular price to those foreign suppliers we need, as
    well.
        Senator Moran. If the Strait was open tomorrow, what would
    happen?
        Mr. Rosenbusch. Obviously, you are going to see an impact,
    and we need those vessels that are behind the Strait to come. I
    think it is going to take a while for that market to work
    itself out because, as I mentioned in my testimony, 40 plants
    there have been either curtailed because of no natural gas or
    they were hit by missiles or drones.
        Senator Moran. I understand. Thank you all very much.
        Chairman Boozman. Senator Justice.
        Senator Justice. Well, you all waited a long time to hear
    from me, haven't you? You will find me to be this guy. I will
    be the guy with logic and reason, and I appreciate our Chairman
    like you cannot imagine. I appreciate all these great Committee
    Members right here, and they do a great job. They really do.
        There is a real, real, real problem here, and I have heard
    lots and lots and lots of stuff from lots of people here just
    today, and they say things like, ``What do we do to get
    fertilizer prices down?'' Is the Iranian war killing farmers?
    Plenty of dollars in ag, but farmers are not getting those
    dollars.
        You know, Trent Kubik says many things, but the one thing
    that absolutely just beams from him is he loves what he is
    doing, and he does not want to give it up.
        You know, I started our farming operation in, well, 50
    years ago, and we grew it. At one point in time we were the
    biggest cash grain farmers, I think, east of the Mississippi
    River. We were seven or eight times National Corn Growers--and,
    you know, Trent, I know you are in the National Corn Growers
    and everything--but we were seven or eight times National Corn
    Growers winners.
        I know a lot about this. I really do know a lot about it. I
    am a business guy. You know, I have got an MBA, and I am a
    business guy, and I would tell you just this. You have a
    colossal problem, because you have got a lot of people here
    that would really like to help, but I do not know that they
    will. At the end of the day, you have got frustration, and to
    be perfectly honest, it is probably going to get worse.
        We have to move. Mr. Chairman, you know, and I know too,
    that we have to move. We are losing folks every day, and the
    tragedy is beyond teetotal belief. You know, I think about
    Eddie Melton there, and I have known him forever and a day, at
    least known of him forever and a day, and now I am getting the
    opportunity to meet him and everything. Eddie, I would say to
    you just this. Did you ever know Ken Wells, Dr. Kenneth Wells,
    at the University of Kentucky? Dr. Kenneth Wells came to our
    operation when I was just a kid, and really basically I owe
    just almost everything I know about agriculture, and it is a
    boatful, to Kenneth Wells.
        You know, there is so much goodness in this room it is
    unfathomable. When you think about questions of, well, does the
    fertilizer industry really want transparency, are you kidding
    me? Really? Do we really believe that? Sure, it is easy for us
    to say, but do we really believe? I mean, what we have here is
    a monopoly. We do. I mean, if we look back at ag prices, just
    think just a second about this. In 2022, not very far ago, corn
    prices were $7. Today, at harvest time this past year, they
    probably drifted significantly into the $3-and-something price.
    Do you realize that when Harry Truman was the President of this
    country, corn prices were $2.50? Go back and look.
        Think about it. How in the world can we possibly, possibly
    not act? We have got to move now, or we are going to awaken to
    an agriculture industry that is so different than we could ever
    think, and it would be bad. It will be bad for all of us. We
    have got to do something right this minute.
        I do not know exactly what all the answers are, but there
    are all kinds of combinations of lots and lots and lots of
    things. It can be done. It can really be done. Absolutely, we
    have got to move, and move today.
        You know, from the standpoint of fertilizer prices, it is
    the most bewildering thing in the world. Just think about this.
    I am from a state that abounds in coal, as well. Metallurgical
    coal, is it forever more just this. You let metallurgical coal
    go from $100 a ton at the mine site to $200 a ton,
    instantaneously, freight costs will go from $30 a ton to $53 a
    ton. Then if the price goes from $200 to $300, the freight cost
    will go from $53 to $61 a ton. Nothing has changed. Nothing has
    changed.
        It is all up to us. It is all up to all of on this
    Committee. It is all up to us as legislators to do something,
    because these people are really hurting. It is time right now.
        Mr. Chairman, I know how much you love these people, and I
    plead with you, some way, somehow, we have got to solve the
    riddle, because they are really important.
        God bless each and every one of you. Thank you.
        Chairman Boozman. Thank you, Senator Justice, and very well
    said. Senator Schiff.
        Senator Schiff. Thank you, Mr. Chairman. Mr. Green, last
    week I was lucky enough to engage with some of the agricultural
    leaders across Ventura County. These fresh produce growers
    shared a bit about their challenges being squeezed by
    retailers, whether that is not being able to sell in the
    grocery stores because imported produce is cheaper, receiving
    the same cut even when the input prices change, or essentially
    subsidizing the remainder of products sold by retailers. Can
    you elaborate on how specialty crop growers suffer when buyers
    abuse their market power, especially in a consolidated retail
    market?
        Mr. Green. Thank you, Senator. You raise a very big
    challenge, which is there are dominant power buyers in the
    retail space that can exercise their power upstream to the
    farmer, and no matter how fabulous the product they are
    raising, they do not have the opportunity to meaningfully
    negotiate when there are so few choices of where they can bring
    their product. When the largest power buyers have the footprint
    in the market, so that if they go someplace else, or if they go
    to USDA and say, can you please inspect instead of dinging me
    without documentation for not delivering certain amounts or
    things, or when they change contract terms. You know, these are
    longer-term contracts. Well, if the price goes up, the power
    buyer keeps the same low price. If the price goes down,
    suddenly the farmer has to eat that price drop. Same thing
    around financing terms that are getting longer and longer. The
    farmer is floating the retail power buyers' no-interest rate
    loan.
        It is real evidence that there are market power problems in
    the market you refer to. There are probably violations of the
    Perishable Agricultural Commodities Act, as well. It is the
    same type of thing we see in other sectors, as well, of this
    imbalance of market power that requires USDA, DOJ, FTC, and
    government to help balance those situations.
        Senator Schiff. In some of those mass retailers, isn't the
    produce section really the profit driver for most of the store?
        Mr. Green. I do not know that per se, but I think it is the
    one thing that pulls people into the door. When it is pulling
    people into the door, and it is the most attractive part of the
    store, that is something that is really important. Making sure
    that the farmer is sharing in the benefits is precisely why
    there are rules around making sure that volume discounts are
    available to every retailer, making sure that when a product
    comes, there is a USDA inspector that can make sure that the
    farmer is protected against being dinged without documentation
    by the retailer, et cetera.
        Senator Schiff. You mentioned that some of these practices
    might violate a certain statute. Can you explain that?
        Mr. Green. The Perishable Agricultural Commodities Act goes
    back to 1935, I think. It prohibits unfair, deceptive
    practices. It is similar to the Packers and Stockyards Act. It
    is similar to certainly the Federal Trade Commission Act. It
    basically says if you are doing business, you have got to do
    business in a fair way transparent way. These are well-
    established principles, and USDA has enforced it for a very
    long time. I do worry about staffing at the Agricultural
    Marketing Service and other places, but it is very important
    statute for the efficiency and competitiveness of the specialty
    crop industry.
        Senator Schiff. Any other ideas you can share about how to
    equalize, even a little, the incredible disparity between the
    market power of these mass retailers and farmers?
        Mr. Green. You have got to rein in the market power of the
    retailers. That is one of the reasons why the Robinson-Patman
    Act sets prohibitions against discriminatory, predatory, and
    other types of pricing differences, so that you can have a
    competitive retail sector, so that the dominant power buyer is
    not able to be so dominant that the farmer does not have a
    choice. If there is a competitive retail market and a retailer
    is not playing fairly, they can go someplace else and sell
    their product. If you do not deal with the concentration of
    power at the retail level, it is going to flow up to the
    farmer.
        Senator Schiff. Thank you very much. Thank you, Mr.
    Chairman.
        Chairman Boozman. Thank you. Senator Slotkin.
        Senator Slotkin. I apologize for being late. I had another
    hearing that just finished up. Sorry, gentlemen, and I know you
    have gone through a lot of this. If you are getting me, you are
    at the very end, so you can rest easy.
        I have a question. I come from Michigan, so specialty crop
    state. Obviously, we do have row crops, but specialty crops are
    what we specialize in. That tends to be small- and medium-sized
    farms. We are not the megafarms of some other states. I was
    actually hoping to ask a question of Mr. Melton. Just can you
    talk about what the pinch on fertilizer is really doing,
    particularly in your state, to some of the specialty croppers,
    you know, the fruit and vegetable folks? I feel like they are
    already on their heels because of all the uncertainty going on
    in ag generally, and they are smaller. Can you talk to me about
    what you are seeing in Kentucky?
        Mr. Melton. Sure, Senator, thank you. You know, we all know
    what fertilizer is. It is plant food. I do not care if you are
    growing specialty crops, if you are growing row crops, if you
    are growing forage for your livestock animals, fertilizer is an
    important key to that. When you bring it down to that level,
    that is what we all are dealing with right now, so it is the
    cost of those fertilizers. In our specialty crop markets, it is
    very much noted that it is affecting them on their farms, just
    like it is all the other aspects of when we are purchasing
    fertilizer.
        Senator Slotkin. Yes. It feels like there are so many
    variables in ag right now. Obviously, the weather you cannot
    control, but there are all these other factors that are just
    making it really hard for small- and medium-sized farmers, at
    least in my state, to keep farming. I mean, I think there are
    real existential questions going on for folks. I live on my
    family farm. I lease the land out to a soybean farmer, so I see
    those things very clearly.
        Does anyone on the panel have a sense, you know, we have
    this chokepoint right now in the Persian Gulf, traffic is not
    getting back and forth. Let's say the Persian Gulf opened up
    tomorrow. How long do we understand it would be until that
    fertilizer actually gets through, comes back to the United
    States, and we can see this market regulating? I know the oil
    and gas people say it will be a year even if the Strait of
    Hormuz open up today. Does anyone have a sense on fertilizer?
    Sir, go ahead, please.
        Mr. Rosenbusch. I guess that is my question, Senator
    Slotkin. Thank you for the question. Thank you for your
    knowledge of potash, too.
        Senator Slotkin. I am a big fan of potash.
        Mr. Rosenbusch. You have become the expert of potash, so we
    appreciate all you do there.
        Yes, once the Strait is open, it would obviously take a
    good month for those vessels to clear and to get to the market
    destinations. What is still unclear is what the damage has been
    to those manufacturing sites in that region. We estimate that
    there are about 40 plants that have been shuttered or closed
    down because either they no longer can produce or they were
    actually damaged because of the conflict. It could be months,
    or it could be years, for those plants to come back online.
        Senator Slotkin. Can we stay on potash for just one second,
    because look, we have discovered potash in Michigan. We are
    very excited about it. I am supportive of us mining that
    potash. What do you see as the challenge of getting that off
    the ground? I do not know, again, if there are others who also
    want to answer that.
        I am a big believer in permitting reform and making it
    easier to make good economic decisions that affect economic
    security and national security. I think having access to
    critical minerals is part of that. Tell me what the constraints
    and the situation is.
        Mr. Rosenbusch. I would say that, as you know, we need our
    farmers to have as much supply as possible so they can be
    successful. Permitting is a huge issue. It takes decades to get
    these mines up and running. Capital is a huge challenge, as
    well, when you are talking about billions of dollars of capital
    that it takes to run, and the return that is required. That is
    another issue. I am sure Mr. Westling can comment a little bit
    from a nitrogen perspective. Really, it is permitting and
    capital that are probably the two biggest challenges.
        Senator Slotkin. Yes. I am a big believer. I mean, again,
    the answer can be no when you are asking for a permit. It just
    should not take 15 years to get a yes or no, right? Just get to
    decision faster.
        Mr. Rosenbusch. Certainty. If people are putting the
    investment into these facilities, in five years, what is the
    market going to look like, and can you still justify it?
        Senator Slotkin. I think that is fair. I do not want to
    abuse my time, Mr. Chairman, but I see there are other folks on
    the panel, if it is okay to just finish up.
        Mr. Green. I just want to add, Senator, that you also need
    a competitive market, and you want to talk about getting new
    fertilizer. If the market is constrained and is shut, and the
    dominant powers are going to ice anybody that enters it out by
    lowering the price or squeezing them, there is really no
    incentive to invest.
        There have been a series of mergers that go back to 2010,
    2013, 2015, and 2018. All of those mergers can be reviewed by
    the FTC and the Department of Justice. Under a retrospective
    review, they can all be undone. The price of fertilizer, even
    if the Strait of Hormuz opens back up, we saw the price of
    fertilizer in 2022 drop back, but not basically to where it was
    prior to the Ukraine war. It has stayed high.
        The issue of these longstanding trends toward concentration
    show that the underlying competitive dynamics of the market
    really do need to be addressed.
        Senator Slotkin. Great. Thank you, Chairman. I yield back.
        Senator Boozman: Thank you. I have just a couple of things,
    since I gave my time away to Senator Thune.
        We talked a lot about transparency today and access to more
    information. I guess the question I would have for you, Mr.
    Kubik and Mr. Melton, as producers, what information do you
    have access to that helps you better understand the input
    markets, and what additional information would be helpful? Have
    you got anything specific that we can actually sink our teeth
    into?
        Mr. Kubik. Thank you, Senator, for that question. I think
    right now, again, as I said before, a lot of our information
    comes from our retailers and the information they are getting.
        Chairman Boozman. Can you understand it?
        Mr. Kubik. Somewhat. A little bit. It is hard to fathom how
    a corn price can be here, and a fertilizer price can be here,
    even when corn was here, and fertilizer was here. It is hard to
    understand it.
        Chairman Boozman. Sometimes it is so complex, too. There is
    so much information.
        Mr. Kubik. Yes. I would just say if we can see ports of
    where fertilizer is coming from, like for us, Minneapolis,
    Sioux City, NOLA down in the Gulf, just to kind of get our
    heads wrapped around where that market is at, and just see the
    margin built in, see what the supply chain is like from
    manufacturer to processor to distributor to retail. Like I
    said, just to help us plan and mitigate our risk a little bit
    more.
        Mr. Melton. We know the demand is there. We have talked
    about that several times today. I think knowing what the supply
    is that we are dealing with ahead of time, what is the supply
    going to be moving forward. Because that is what basic
    economics is, is supply and demand, and it sets price. If we do
    not know what the supply is, and we know the demand is there,
    and the supply changes all the time on us. If we had some way
    to know and predict kind of what the supply is, moving forward,
    and we have access to that information, I think it helps me, as
    a producer, and I think it would help Trent, too, knowing where
    that supply is, and if we are going to be able to get it when
    we need it.
        Chairman Boozman. Thank you. Mr. Westling, you are in the
    process of building your new facility in Nebraska. Give us a
    thing, like I say, you are experiencing this, give us a thing
    that Congress or the Administration could do to spur increased
    domestic fertilizer production. What would have helped you?
        Mr. Westling. Well, I think the FPEP program----
        Chairman Boozman. Besides money.
        Mr. Westling. Thank you for that question, Senator. I think
    the FPEP program, the construct was good, and what it wanted to
    do, and incentivizing these types of projects was a good thing,
    and ultimately could be distributed in a way that could have a
    big impact on bringing more of these to the marketplace. I do
    not think there are 20 or 30 projects that need to be built. I
    think it is a handful of places to augment the larger
    production. Bringing dollars to those projects would absolutely
    be impactful.
        Chairman Boozman. Very good. Finally, and then we are going
    to give you all a break, we have seen military conflict, trade
    disputes, all that is going on in the world right now. We live
    in a dangerous world. This is for anybody who just wants to
    jump in. What else should we be doing to reduce our exposure to
    foreign disruptions? We have seen what blocking the Strait has
    done. This is national security. Do we need to consider, like
    we have an oil reserve? Do we need some sort of reserve of
    fertilizer? Has anybody got any ideas?
        Mr. Green. I want to underscore the importance of seeds
    here, where seed resiliency and the seed bank at the National
    Plant Germplasm System is really a national security resource,
    so that we have the genetics to be able to adapt to regional
    varieties, and the research and the access. The Department of
    Justice filed, just yesterday, a very important statement in a
    private case around the ability to read the genetics.
        I think fertilizer has to be thought of in context of these
    other tools that can keep us nimble, flexible, resilient, and
    self-reliant, really, across these markets.
        Mr. Rosenbusch. Yes, Senator, thank you for that question.
    We have talked a lot about strategic reserves recently.
    Fertilizer is very different than oil and gas. It would be an
    honor to take you to some of these massive facilities and
    warehouses where some of these products are stored, and you
    will see the capital and complexity of how large these
    facilities are.
        Fertilizer, as well, if kept for a long period of time, the
    quality can deteriorate fast. You get clumping. You start to
    see it really kind of form a big old block of concrete. It is
    not something that can be stored for long periods of time. The
    answer is let's bolster our domestic supply with projects like
    Mr. Westling's.
        Chairman Boozman. Very good.
        Mr. Kubik. I would add to that just simply by saying make
    the stuff where you use the stuff.
        Chairman Boozman. Great. Thank you all very much. This has
    really been a good discussion. I think everyone on the panel
    has learned a great deal as a result of this. As you can see,
    this Committee is very serious and really does just a good job.
    We have got a great group of Members on both sides, that work
    hard. As was mentioned, agriculture, farmers are not about
    Republican farmers or Democrat farmers or Republican small
    towns or Democrat small towns. This is about trying to help out
    and trying to stabilize just a tremendous asset of this
    country.
        With that, again, thank you for being here. The record will
    remain open for five business days, and we are adjourned.
        [Whereupon, at 5:05 p.m., the hearing was adjourned.]

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                                A P P E N D I X

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                       DOCUMENTS SUBMITTED FOR THE RECORD

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                             QUESTIONS AND ANSWERS

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