Industry leaders say fertilizer prices are easing, but farmers are facing volatility on other fronts, both regulatory and financial.
The good news is some relief on fertilizer costs. Fertilizer Institute head Corey Rosenbusch; “Fertilizer prices have come down. Farmers have definitely taken a wait and see approach, as we approach the spring planting season. European nitrogen plants have restarted. China has slowly begun exporting product. Russia trade flows have shifted, and actually had a record year of exports, last year.”
While fertilizer demand on high planted acres and low stocks will remain strong.
On the flip side are interest rates. This exchange between Iowa Republican Representative Randy Feenstra and American Farm Bureau President Zippy Duvall; “Interest rates are crushing, and our young farmers—whoever they might be—are going to feel the blunt of that, worse than ever before, if it continues to rise.” Feenstra “I agree a hundred percent, and there’s no end in sight, right now, and the Feds have said this, that they don’t know where these rate increases are going to end.”
And then, there’s regulation, including the new Biden EPA ‘Waters of the U.S.’ or WOTUS rule. Duvall; “Our farmers feel like a ‘ping pong ball’ going back and forth from one side of the table to the other, not being able to make long-term decisions, based on what evidence we have. This new rule that came out in December, took it from a rule that was clear, that we could understand, to making it just muddy as muddy water.”
All that and a huge looming budget fight over soaring debt, deficits and interest rates, and farmers and farm bill writers could be facing a ‘perfect storm’ in 2023.