How farmers are squeezed by high input prices that are set by the fertilizer oligopoly
A recent Ruled by Reason podcast from the American Antitrust Institute (AAI) dives into an issue that’s no secret to farmers: soaring fertilizer prices strangling margins for family farms.
AAI President Diana Moss hosts the episode entitled The High Costs of Growing Corn: How Growers are Squeezed by High Input Prices That Are Set by the Fertilizer Oligopoly. In it, she visits with Texas Corn Producers Issues Committee Chair Dee Vaughan, a farmer in Moore County, and Joe Outlaw, Ph.D., the co-director of the Agriculture and Food Policy Center at Texas A&M University (AFPC).
The episode notes that farmers pay higher and higher prices to powerful oligopolies for inputs that are necessary to grow their crops. However, farmers then sell into markets where commodity prices are also often controlled by only a few firms and are subject to significant commodity price fluctuations, asserts AAI in the episode summary.
This edition of Ruled by Reason dives into how farmers are paying high prices for nitrogen fertilizer. It highlights an AFPC study recently commissioned by the corn checkoff in Texas and other state corn organizations across the nation, of which Outlaw was a principal researcher.
It also notes other studies, including one done by AAI, that indicate the likelihood that fertilizer producers are more likely to coordinate with each other, rather than compete.
LISTEN NOW to hear more on how anticompetitive fertilizer prices hurt corn growers and consumers and imperil the stability and integrity of a vital agricultural supply chain. The podcast discussion touches on issues relating to the importance of fertilizer for growing corn for its many uses, how corn and fertilizer prices are related, the power of the fertilizer oligopoly, and how international trade issues exacerbate the situation, according to AAI’s episode summary. This episode of Ruled by Reason can be streamed from your favorite podcast platform.