How US lobbying on Moroccan phosphates led to a global food crisis

A US fertilizer producer lobbied the Trump administration to impose tariffs on Moroccan phosphates leading to a plunge in food crisis worldwide.

The US fertilizer producer, a Fortune 500 company called Mosaic CO sought to impose taxes on Moroccan exported phosphates in order to limit foreign competition, emails, and meeting notes obtained by an American nonprofit watchdog showed.

Mosaic CO had arranged for high-level meetings with White House trade officials under the Trump administration to discuss what they believed to be unfair subsidies for foreign importers.

A piece published by Intercept showed that Mosaic paid a lobbying firm called Ballard $1.49 million in fees to secure meetings with some of the top trade officials in the White House, including chief trade negotiator, Robert Lighthizer and the director of the National Trade Council, Peter Navarro.

Meetings culminated in July 2020 in a petition with the U.S. International Trade Commission that investigated the effects of subsidies on Morocco and Russian exporters on US-produced fertilizers.

The US Commerce Department in November 2020 ruled in favor of Mosaic and proceeded to impose tariffs on 20 percent on Moroccan fertilizer giant OCP Group, 9 percent on Russian firm PhosAgro, and 47 percent on Russian-owned EuroChem.

To counter Mosaic’s action, the Moroccan government hired a competing lobbying firm Covington & Burling, which received $15 million in fees to battle the tariffs.

Mosaic counteracted in a letter to the US Agriculture Department officials where it claimed that the rise in food prices is due to “many events, including geopolitical ones” as well as “supply disruptions, inflation, and other countries that have restricted fertilizer exports to preserve domestic supply.”

The decision to impose duties on Moroccan phosphate fertilizer imports was rendered effective by the ITC in March 2021.

The OCP Group, Morocco’s leading fertilizer producer and a global supermajor-producer of phosphate-based products, argued at the time that there was no basis to impose such duties against which many voices inside the American agriculture industry voiced their opposition, from distributors to cooperatives and elected officials.

The new tariffs lead to a sharp increase in fertilizer costs and product prices.

In the US, farmers are now paying four to five times higher than last year, according to a study by Texas A&M University.