OMAHA (DTN) -- Farm groups are continuing to press Commerce Secretary Howard Lutnick to drop the 16.8% countervailing duties on phosphate fertilizer imports.

A collection of 65 state and national groups on Monday sent Lutnick a letter calling on him to end the countervailing duties on phosphate from Morocco "to ease the pain felt by farmers as fertilizer prices reach new highs."

In the letter, farm groups pointed out the Trump administration has made clear lower fertilizer prices is a top priority, yet Lutnick has failed to take any action.

The letter also highlighted the meeting last week in Texas with more than 100 farmer-leaders from 18 states, where Federal Trade Commission Chairman Andrew Ferguson announced an investigation into the fertilizer industry's pricing practices and concentration. The letter also pointed to efforts at USDA and the Department of Justice to investigate fertilizer prices and find ways to lower them. (See link to story below.)

The letter stated, "We write because a Commerce Department policy directly undermines USDA, FTC, and DOJ's efforts. The CVD (countervailing duty) orders on phosphate fertilizer, supported by The Mosaic Company and Simplot and in effect since March 2021, do not protect a vulnerable domestic industry from unfair competition. Rather, they further prop up two companies who already dominate the domestic market and will continue to dominate that market absent CVD protection. We respectfully ask the administration to end these duties to support additional availability return to the U.S. phosphate market."

The letter also noted farmers are in their fourth straight year of losses and countervailing duties only exacerbate their financial outlook and could mean the difference between sustaining family farms for generations to come or seeing legacies come to an end.

"These costs land on an already fragile farm economy," the letter said. "Net farm income has fallen roughly 31% from its 2022 peak, fertilizer prices are up more than 150% since 2020, and Chapter 12 farm bankruptcies have surged to their highest levels in several years."

Farm groups also pointed to a study by the Agricultural and Food Policy Center at Texas A&M University. "The cost of these duties is not speculative," the letter stated. A&M economists estimated the countervailing duties on Moroccan phosphate raised input costs for farmers of corn, soybeans, wheat, rice, sorghum and cotton by roughly $6.9 billion over the 2021 through 2025 growing seasons. At its full initial rate of 19.97%, the duty drove up the U.S. price of diammonium phosphate by an estimated 28.6%, the letter stated.

The duties on Moroccan phosphate have fluctuated from a high of 19.97% down to 2.21% after a review, then raised to a range from 16.6% to 16.8%.

Noting Mosaic controls roughly three-quarters of domestic phosphate supplies, the farm groups also challenged Mosaic's moves to lower production since the war with Iran began.

"Far from safeguarding domestic supply, Mosaic continues to curtail its own production, even as supply tightened at home," the letter stated. "These duties fail to do more than drive up costs for farmers and risk our national food security by limiting the large majority of our annual phosphate needs to a single supplier that continues to curtail production -- enhancing our risks to supply chain disruptions."

The National Corn Growers Association noted it has established an input task force that is looking at the causes of price hikes for supplies and how they can be addressed.

Also see, "At Texas Gathering, FTC Announces Fertilizer Antitrust Investigation Amid Farmer Complaints,"

https://www.dtnpf.com/….

Chris Clayton can be reached at Chris.Clayton@dtn.com

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