OCP has just received important news in its dispute with its American competitor Mosaic. On September 10, 2024, the latter decided to withdraw its request for a third administrative review of countervailing duties (CVD) on imports of Moroccan fertilizers into the United States. This decision could have a significant impact on the American fertilizer market and is a positive development for OCP in this matter.
OCP Group noted that on September 10, The Mosaic Company informed the United States Department of Commerce (DOC) of the withdrawal of its request for a third annual administrative review of the countervailing duties (CVD) imposed on certain Moroccan imports of phosphate fertilizers into the United States. “The Commerce Department should now publish a notice in the Federal Register to rescind the administrative review initiated several weeks ago.”the group said in a press release.
OCP also announces that it “is currently assessing the possible impact of this decision on the final rates applicable to fertilizer imports into the United States in 2023.”
“These duties, initially set at 19.95%, have been provisionally reduced to 7.42% and we hope that they will be further reduced following the appeal procedure currently underway at the Court of International Trade,” he specifies.
And to remember that “the rates applicable to the Group’s current and future cargoes will be determined by administrative reviews that may be requested by The Mosaic Company for the year 2024 and subsequent years, as may be modified in the context of appeals before the Court of International Trade”.
“We hope that this development in the administrative review process is a first step toward fully eliminating these CVDs that prevent American farmers from having reliable access to high-quality supplies of nutrients essential to producing abundant, healthy crops to feed their fellow citizens and compete in global markets.”the Group continues in its press release, recalling that it “remains convinced that there is no justification for CVDs on its fertilizer imports into the United States, especially since U.S. production of these essential nutrients is far from sufficient to meet demand”.
Reminder of the context of the conflict
The dispute between OCP and Mosaic began in 2020, when Mosaic accused Moroccan and Russian phosphate fertilizer producers of benefiting from government subsidies, which the U.S. company said distorted competition by making these products cheaper than those made in the United States. In response, the U.S. Department of Commerce (DOC) launched an investigation. In November 2020, the DOC imposed a countervailing duty rate of 19.97% on imports of Moroccan fertilizer.
Countervailing duties reduced to 2.12%
In March 2021, the DOC confirmed these countervailing duties, a major blow to OCP, which was trying to reduce the burden. However, in November 2023, the DOC revised the countervailing duty rate downward from 19.97% to 2.12% after the first administrative review. This reduction was a significant development but did not end the dispute.
Mosaic’s withdrawal of its review request is now seen as a significant development for OCP. The DOC is expected to publish a notice in the Federal Register to rescind the review.
