Impacts of U.S. Countervailing Duties on Phosphate Fertilizers
AAEA members release new research in AJAE
Recent years have seen a dramatic increase in fertilizer and other agricultural input prices. To what extent have our border policies exacerbated these issues? That is the focus of a new article “Impacts of U.S. Countervailing Duties on Phosphate Fertilizers” published in the American Journal of Agricultural Economics by co-authors Ashley Beeler, K. Aleks Schaefer, Jacob Sestak, and Glenn Conover (all from Oklahoma State University).
In the midst of rising input prices, the USITC issued countervailing duties on phosphate fertilizers from Morocco. Countervailing duties are a policy instrument that attempts to remedy market distortions generated by foreign subsidies by imposing tariffs on imported products.
The authors say, “We find that the countervailing duties increased US phosphate fertilizer prices by approximately 34% over counterfactual levels. This corresponds to an expected downstream price response ranging from around 10% for corn, cotton, and sorghum to between 14% for soybeans and wheat.”
Its possible that the U.S. recently avoided creating a similar bottleneck in the urea market. In July of 2022, the USITC decided not to issue countervailing and anti-dumping duties on urea ammonium nitrate (UAN) from Russia and Trinidad and Tobago.
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ABOUT AAEA: Established in 1910, the Agricultural & Applied Economics Association (AAEA) is the leading professional association for agricultural and applied economists, with 2,500 members in more than 60 countries. Members of the AAEA work in academic or government institutions as well as in industry and not-for-profit organizations, and engage in a variety of research, teaching, and outreach activities in the areas of agriculture, the environment, food, health, and international development. The AAEA publishes three journals, the Journal of the Agricultural and Applied Economics Association (an open access journal), the American Journal of Agricultural Economics and Applied Economic Perspectives & Policy, as well as the online magazine Choices and the online open access publication series Applied Economics Teaching Resources. To learn more, visit www.aaea.org.
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