Corn Growers president warns against potential herbicide tariffs

CHESTERFIELD, Mo. — A commodity group and herbicide formulator called on the U.S. International Trade Commission to reject a petition for tariffs that could be levied on imported 2,4-D from India and China.

The move is in response to a petition filed by Corteva Agriscience on March 14 calling for antidumping and countervailing duties on imports of the herbicide.

Corteva claims 2,4-D imports are injuring or threatening to injure the U.S. ag chemical industry. Corteva said in its petition that 2,4-D producers from India and China were exporting subsidized products into the United States.

Dumping takes place when a foreign producer sells a product in the United States at a price below a producer’s sale price in its country of origin.

Chinese and Indian 2,4-D made up 81% of the chemical’s imports into the United States, according to Corteva’s petition. Corteva is the sole U.S. producer of 2,4-D.

Corteva estimated in its petition the dumping margin for 2,4-D is between 142% and 388% for China and 55% to 139% for India, adding that because of the dumping, U.S. producers continually lost sales and revenues that led to the company’s lost market share.

Antidumping and countervailing duties may be imposed if the U.S. Department of Commerce determines that dumping and subsidization is occurring and if the ITC determines that there is “material injury or the threat thereof” by reason of the dumped or subsidized imports.

National Corn Growers Association President Harold Wolle, of Madelia, Minnesota, warned in his testimony before the commission of the tariffs’ potential impact to American farmers.

“The scenario under consideration has the potential to limit imports of an important product, raise its price and create a supply shortage, all while raising the cost of production in an already tight market,” Wolle said.

“Farmers are price takers, not makers, in selling our commodities, and closely managing our production costs is crucial to our success. Thus, tariffs on these products would create an even more difficult economic scenario for me, my family and the farmers I represent.

“We understand the need to use the right product, at the right rate, at the right time and in the right place. Those are the four pillars of conservation and nutrient management farmers employ across the U.S.

“We are thankful that companies like Corteva have invested in new technologies, including seed traits and herbicides, that allow us to continue producing more effectively and efficiently every year.

“However, if new duties go into force on these imports, and most of the imported product is out of the market, it would put America’s farmers in a very precarious position.

“Thousands of farmers simply cannot rely upon a sole domestic supplier of 2,4-D to meet nearly all of the market’s 2,4-D needs. That will undoubtedly lead to shortages and delays in an industry that needs this product and that must have timely delivery.

“That would be a horrible result for American farmers and, indeed, for the American people who rely on our ability to produce a consistent and reliable product in an efficient manner.”

Herbicide formulator Drexel Chemical also voiced opposition to Corteva’s claims of market flooding by imports from India and China.

Corteva argues tariffs are necessary due to pricing disparities affecting their sales and capacity utilization.

However, formulators disputed Corteva’s assertions, alleging it has prioritized its own product over supplying formulators, leading to increased reliance on imports.

“In the last few years, input prices have skyrocketed. Our Illinois farmers cannot take another hit on this front, especially with current commodity prices,” said Illinois Corn Growers Association President Dave Rylander, a Victoria area farmer.

Corn prices have decreased by over 40% in the last two years. Additionally, the U.S. Department of Agriculture Economic Research Service forecasts farm net income in 2024 at $116.1 billion, a 37% drop from $185.5 in 2022.