When it comes to fertilizer, the U.S. has gone from George Washington experimenting with compost and animal manure at his Mount Vernon estate to heavy reliance on volatile global supply chains.
The latter has led to surprise price spikes and scarcity shocks for a product crucial to feeding an exploding world population and America's food security. Crop nutrients can account for more than 40% of total operating costs for corn and wheat farmers.
In the last five years alone, a pandemic, U.S. sanctions on key producer Belarus and war in Europe on top of natural gas outages have led to disruptive market swings and soaring prices. Most recently, President Donald Trump’s tariffs have triggered a jump in the cost of phosphate, which along with potash and nitrogen make up the trio of essential fertilizers.
Hunter Swisher (Phospholutions photo)“All of the sudden it became very unappealing to move some of those international supplies into the country whereas they (importers) normally would try to benefit from the high price, the downside of the tariff outweigh the benefits," said Hunter Swisher, founder and chief executive officer at Phospholutions.
The company says its patented technology makes phosphorus fertilizers more efficient, less expensive and better for the environment.
Michigan Potash & Salt Co. won support from both the Trump and former Biden administrations to move forward with its goal of mining 800,000 tons a year of potash. In Washington, Sens. Joni Ernst, an Iowa Republican, and Elissa Slotkin, a Michigan Democrat, are jointly calling to “bring phosphate production home."
Hiro Iwanaga, co-founder and CEO of Talusag, seeks to build 80 low-cost, carbon-free and locally accessible ammonia facilities across the Corn Belt over the next couple years after success in sub-Saharan Africa.
For potash and phosphate, the effort is part of an increasingly urgent goal of weaning the U.S. off its dependence on foreign markets for minerals needed to feed and fuel the country. In the case of ammonia, the aim is to break many farmers’ dependency on unpredictable price swings and domestic supply chains sometimes hundreds or even thousands of miles away from a grower’s crops.
Trump's tariffs intensified a U.S. push to put phosphate on its list of critical minerals, which the Trump administration did last week for the first time. Mosaic Co., a top producer based in Florida, praised the move as essential to U.S. economic stability and national security.
Phosphate imports account for almost 30% of America's supply, from countries including Saudi Arabia and Jordan. Meanwhile, domestic resources are drying up as demand is set to rise even further.
"Although globally we have hundreds of years, in the U.S., we have less than a few decades of these reserves left and they are dwindling quite quickly," Swisher said. "We are hitting lower quality rock faster than we expected."
Swisher said he'd like to see more discussion around phosphate as a crucial mineral focus on innovation and technology solutions in addition to the Trump administration's push to streamline permitting for new production. "I'd caution policymakers on the fact that opening new mines and extracting resources faster just continues to accelerate how quickly this problem will present itself to us," he said.
Replacing Canada's potash behemoth
Back in 2022, when the Russia-Ukraine war broke out and sent nitrogen fertilizer prices to record highs, the Biden administration began an effort to expand U.S. production of crop nutrients.
The sting of high fertilizer costs for farmers has prompted USDA and the Department of Justice to look at market concentration issues as only a handful of nations and companies make up the bulk of all major fertilizer production. In September, Sens. Chuck Grassley, R-Iowa, and Tammy Baldwin, D-Wis., reintroduced legislation calling for a study on fertilizer prices.
“While we cannot directly influence prices, we can bolster domestic supply to help mitigate geopolitical risks for our American farmers," Fertilizer Institute CEO Corey Rosenbusch said last month at a Senate Judiciary Committee hearing chaired by Grassley.
Corey Rosenbusch (LinkedIn photo)Of the three main fertilizers, the U.S. is most dependent on other countries for potash, which refers to minerals and chemicals that contain potassium needed for plants.
Ted Pagano, recently dubbed the “Potash Prince” by Forbes magazine, has $1.3 billion in federal funds to start developing what he says is the biggest U.S. potash reserve, which sits in northern Michigan with an estimated 150-year lifespan.
The Michigan Potash & Salt facility aims to use geothermal energy to create high-grade potash and food-grade salt.
"We have access to one of the tightest globally contested commodities when it is needed more and populations are rising." Pagano said. "The Michigan deposit can change generations to come. It provides a long-term solution to help farmers face challenges when those input prices are high."
Michigan Potash & Salt seeks to produce 10% of the U.S.'s potash needs by 2028 and potentially on a path that could lead to as much as 40% over time.
Today, nearly all the roughly 90% in potash supplies shipped to the U.S. each year come from Canada. Trade tensions between the two nations have caused concern this year that Trump might place tariffs on Canadian fertilizer. Saskatchewan, which has the world’s largest potash reserves, accounts for more than one-third of global potash production.
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Treasury Secretary Scott Bessent said last week “a price must be paid” for a Canadian TV commercial critical of Trump’s trade policies. While the warning may not end up translating to tariffs on Canadian fertilizer, the mere threat underscores the unpredictability of a market on which American farmers are so extremely reliant.
Brazil, the world's top soybean grower and an increasingly important corn producer, also is highly dependent on other countries to meet its fertilizer needs. After the tumultuous market disruptions of the last several years, Brazil set a target to slash its need for foreign crop nutrients.
Startup Brazil Potash is hoping to play a big part in that goal by developing what it says could become the world's second-largest potash mine, after North America.
Potash is becoming even more crucial for farming as it helps plants deal with stress, such as wild temperature swings that are becoming more noticeable or other shifts in climate like more frequent droughts and flooding, Brazil Potash CEO Matt Simpson said.
"Potash also makes food firmer and taste better," he said. "What helps make a banana be nice and ripe and firm is potassium, and what helps makes a tomato firm and not mushy."
Startup eyes 'Must-have' nitrogen
Meanwhile, nitrogen contained in ammonia is largely considered a “must have” nutrient for growing major crops like corn, wheat and all sorts of fruits and vegetables. While the U.S. has reduced nitrogen fertilizer imports from around 20% in 2000 to between 6%-13% since 2020, it’s highly vulnerable to global market disruptions.
Hiro Iwanaga (Talusag photo)“The volatility makes it very difficult for farmers to plan, make investments and hire people,” said Iwanaga of Talus, a U.S.-based startup that seeks to bring farmers locally made, carbon-neutral ammonia at a fixed price that the company claims lowers growers’ costs by more than half.
Green ammonia is produced from the hydrogen in water and nitrogen that's in the air, using renewable energy. Anhydrous ammonia is produced from natural gas.
Although anhydrous can be less costly to produce, green ammonia has little or no shipping cost if it's produced near farms. The 45V clean hydrogen tax credit also has helped lower the production cost as well, although it ends after 2027, under the Republican budget law enacted this year.
“Talus locally produces green ammonia in places where we are cost competitive or cheaper than imports. In Iowa and across the corn belt," Iwanaga said.
Talus, along with farm co-operative Landus, earlier this year began running in Iowa North America’s first commercial green ammonia production with its modular systems.
Talus' first deployment of its technology was at a nut farm in Kenya. In the U.S., the company seeks to rapidly install its systems in key parts of the farm belt, especially in places like South Dakota that are lacking access to major fertilizer distribution systems.
"Farmers in South Dakota pay $100 to $150 more per ton for ammonia as farmers in Iowa just because of the logistics," Iwanaga said. "It has similar dynamics as a land-locked country in sub-Saharan Africa."
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