The U.S. Justice Department has launched an antitrust investigation into the U.S. fertilizer industry. According to a report from Bloomberg News, the probe seeks to determine whether leading commercial fertilizer producers colluded to raise prices.
DOJ Probe Targets Fertilizer Companies
The investigation targets Nutrien, Mosaic, CF Industries Holdings, Koch and Yara International ASA. These companies together control a significant share of the U.S. nitrogen, phosphate and potash fertilizer markets.
Currently in its early stages, the probe is being run out of the DOJ antitrust division’s Chicago office. Investigators are examining pricing practices for possible civil and criminal antitrust violations.
Industry Consolidation Drives Up Fertilizer Prices for Farmers
The scrutiny comes after the U.S. fertilizer industry underwent dramatic consolidation over four decades. According to USDA data, the number of nitrogen fertilizer producers declined from 46 to 13 between 1984 and 2008, representing a reduction of 72%.
Today, four firms control 75% of the domestic nitrogen fertilizer market. Research from the University of Waterloo indicates only two firms control nearly 100% of the U.S. potash market. This pricing power became particularly evident in 2021 when fertilizer costs surged dramatically.
USDA figures show the prices U.S. farmers paid for fertilizers increased by over 60%. Nitrogen fertilizer prices jumped 95%, while potash prices rose over 70%. These increases added an estimated $128,000 in costs per farm for feed grain operations in 2022.
Collusion or Supply and Demand?
Is the current spike in fertilizer prices tied to geopolitics, or are fertilizer companies really price-fixing? Lane Akre, an economist with Pro Farmer, suggests the issue is more about availability than intent.
“It’s not a matter of collusion. It’s a matter of just not enough supply out in the world, and the U.S. has not done enough to produce more of those fertilizers,” Akre says.
He notes this is a broader problem that cannot be fixed overnight.
“The rhetoric is really starting to turn into ‘This is a national security issue, this is a national food issue, we need some of those subsidized dollars going into production.’ The administration is beginning to see that and believe that, and that could help, but it’s not going to help in 2026. It might not even help in 2027, but if we were able to get some of these planes in place, it could help in the long term.”
Industry Officials Say There is No Price Fixing
Officials with CHS say the structure of the North American fertilizer business also plays a role in current market conditions. Scott Cordes, CHS board member and farmer from southeast Minnesota, believes the market is simply reacting to external pressures.
“I think it’s doing what the market does. I mean, logistically, some things impact there,” Cordes says. “I mean, I’d be very honest, there’s pretty good consolidation in the fertilizer industry. But it takes big investments. You can see where that industry’s had to kind of rationalize a bit to get the investments and provide the product, but it always creates questions when things spike up.”
Farmers Have Mixed Opinions
Farmers attending the CHS Ag Industry Day in Grand Forks, N.D., expressed mixed opinions on what is driving prices beyond supply and demand. Kurt Akre, who farms near Carlton, Minn., notes a disparity in how quickly prices change.
“It seems like the prices like to rise up pretty fast, and they come down kind of slow,” he says. “So, I think they know what’s happening out there, and they kind of price accordingly.”
However, Paul Sproule, who also farms in Grand Forks, disagrees with the idea that it is a simple market correction.
“Fertilizer’s up over a year ago, but I think a big part of that is driven by too few players,” Sproule says. “I will be honest with you, you know, when you have monopolies control fertilizer, that’s what happens.”
However, its harder to tell when you have an event, like the war in Iran, also adding to the spike in fertilizer prices.
