Klobuchar Addresses Rising Fertilizer Prices at Senate Agriculture Committee Hearing

WASHINGTON-U.S. Senator Amy Klobuchar (D-MN), Ranking Member of the Senate Committee on Agriculture, Nutrition, and Forestry, today delivered the following opening statement at the Agriculture Committee hearing titled "Perspectives on the Fertilizer Industry: Ensuring a Stable and Affordable Supply for American Producers." In her remarks, Senator Klobuchar addressed the rising fertilizer costs in America due to the war in Iran, tariffs, and market consolidation.

In March, Klobuchar, John Thune (R-SD), and Roger Marshall (R-KS) introduced bipartisan bills to address high fertilizer costs in the wake of the war in Iran, tariff threats on fertilizer imports, and fertilizer market consolidation.

The Fertilizer Transparency Act (Thune-Klobuchar) will create a mandatory price reporting system to offer market participants of all sizes with comparable levels of market information on fertilizer components. This bill is also cosponsored by Senators Grassley and Baldwin.

The Homegrown Fertilizer Act (Klobuchar-Marshall) will create a grant and loan program to expand domestic fertilizer production and improve fertilizer storage capacity.

A rough transcript of Klobuchar's full opening statement is available below and a video can be downloaded here.

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. So 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%, 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. 30% 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's 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. And last week, the Court of International Trade ruled against the President's authority to use a different statute for these authorities for these tariffs. And 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% of U.S. nitrogen fertilizer sales and all domestic potash and phosphate. That's why I partnered with Senator Thune, who's 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's also with us, and I have introduced the Homegrown Fertilizer Act to do just that, so we can ease our dependence on imports. And 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. But 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.

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