U.S. agriculture department opens inquiry into fertilizer, seed prices

FILE PHOTO: Chris Hays drives a new tractor and planter during spring planting at their farm in Malvern, Iowa, U.S., April 27, 2021. REUTERS/Rachel Mummey/File Photo

(Reuters) - The U.S. Department of Agriculture is opening an inquiry into the impacts of concentration in the fertilizer, seed, and retail markets, according to an agency press release.

The inquiry stems from the Biden administration’s July 2021 executive order to promote competition across the U.S. economy, the agency said Friday.

Global supply chain problems and inflation have sent fertilizer and other farm input prices soaring, limiting farmers’ ability to capitalize on decade-high grain prices. Fertilizer is expected to be even more scarce as global markets shun Russia, a fertilizer exporter to North and South America, following its Feb. 24 invasion of Ukraine.

“Concentrated market structures and potentially anticompetitive practices leave America’s farmers, businesses, and consumers facing higher costs, fewer choices and less control about where to buy and sell, and reduced innovation — ultimately making it harder for those who grow our food to survive,’ Agriculture Secretary Tom Vilsack said in the release.

Vilsack said in February that he hoped that fertilizer and agricultural input supply companies would not take advantage of the crisis in Ukraine to push already high prices higher.

The Iowa attorney general’s office is also investigating high fertilizer prices. Prices for urea and potash are up more than 200% since January 2021 and liquid nitrogen is up 290%, the office said in February.

The USDA will collect comments for 60 days.

The Department also announced a $250 million grant to support “independent, innovative and sustainable American fertilizer production.”

Reporting by Leah Douglas; editing by Jonathan Oatis