MOROCCO – The OCP Group, Morocco’s leading producer and exporter of fertilizers, has voiced its disappointment in response to the US Department of Commerce’s (DOC) plan to raise tariffs on Moroccan phosphate fertilizers to 14.21%.
This decision, which contrasts with a previous reduction to 2.12% in November 2023, has prompted concern within the industry and strained trade relations between the two nations.
In a press release published on April 30, the OCP Group conveyed its disappointment with the DOC’s preliminary results, which it believes were influenced by deficiencies in the methodology used to assess tariffs related to phosphate ore exploitation.
Despite expressing disappointment, OCP intends to challenge the DOC’s decision by appealing to the United States Court of International Trade (CIT), citing concerns over the methodology used by the DOC to evaluate tariffs related to phosphate ore exploitation.
“We are disappointed by these preliminary results, which we understand to be largely influenced by deficiencies in the methodology applied by the DOC to evaluate the rights of the OCP Group with respect to its exploitation of phosphate ore. We will continue to appeal these tariffs to the CIT and will continue our full cooperation with American agencies as part of their analyses,” the group said in a press release.
The OCP Group’s reaction underscores the significance of the US market for Moroccan fertilizers. In 2022, the USA ranked as the sixth-largest market for Moroccan fertilizers, with purchases exceeding US$392 million.
However, reports from American media suggest that the DOC’s decision stems from concerns over the financial performance of US companies in the fertilizer sector, with industry leaders like Mosaic Co. experiencing a substantial decline in turnover.
According to an investigation by American Media, Mosaic Co reported a staggering 26% drop in revenue to US$2.7 billion in the first quarter of 2024, attributing the decline to falling fertilizer prices in the domestic market.
In November 2023, a group of US senators and representatives addressed a letter to US President Joe Biden, asking his administration to lower import duties on phosphate fertilizers sourced from Morocco’s OCP group.
“We ask that Commerce carefully consider and follow the U.S. Court of International Trade’s (CIT) decision in Commerce’s recalculation of the subsidy amount, both in its final determination in the investigation and its administrative review,” the politicians wrote in the letter.
According to their plea, reducing the subsidy rate would provide welcomed relief for U.S. farm suppliers and their customers, American family farms.
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