The Fertilizer Institute Testifies Before U.S. House Agriculture Committee

The Fertilizer Institute (TFI) recently testified before the U.S. House of Representatives Agriculture Committee regarding the 2007 Farm Bill and its ability to address the challenges being faced by American farmers and the North American fertilizer industry. Alex McGregor, president of The McGregor Company and TFI board member, cited passing energy legislation, enhancing emergency disaster assistance, fully funding agriculture conservation programs and strengthening federal farm safety nets as key to the new farm bill.

“While there are many strengths in the current farm bill, strengths which can be built upon, the lack of an effective safety net to cushion through down cycles has meant that record numbers of producers are falling through holes in the netting and drowning in red ink or bailing out before they lose the last of their equity,” said McGregor during his testimony. “Your help in framing a new farm bill that fine-tunes what we have with ‘safety net’ provisions that can help in tough times and that provides some protection against runaway energy prices is badly needed and much appreciated.”

Recent high-energy costs have created an unanticipated shock to McGregor’s area wheat farmers and the entire U.S. farm economy. The Food and Agricultural Policy Research Institute (FAPRI) estimates that fuel prices have increased 113 percent and fertilizer costs 70 percent since 2002. Natural gas represents 70 to 90 percent of the production cost of one ton of anhydrous ammonia – the building block for most other forms of commercial nitrogen plant nutrients. McGregor shared that the cost of natural gas rose from approximately $3 in 2002 to as high as $15 late last fall. Consequently, the fertilizer industry has closed 24 nitrogen production plants since 1998 and ammonia production has fallen 35 percent.

McGregor urged Congress to reconcile and pass of H.R. 4761, the Deep Ocean Energy and Resources Act, and S. 3711, the Gulf of Mexico Energy Security Act, before Congress adjourns in the coming weeks for the November elections. “The future of farm families and those who serve them is on the line – I know of no other action that could better help us ensure affordably priced plant food for the American farmer for the next several years.”

McGregor also urged the committee to pass emergency disaster assistance to help combat severe weather related disasters and the economic consequences of high-energy prices.
The Senate and House Agriculture Committees have been holding hearings in preparation for crafting the 2007 Farm Bill. The current farm bill, written and signed into law in 2002, is set to expire next year.

The McGregor Company, headquartered in Colfax, Wash., serves 2,000 dryland wheat, legume and barley growing families in the inland Pacific Northwest and families who grow potatoes, corn and many other crops in the adjacent Columbia Basin. The McGregor Company has 42 retail facilities in Washington, Idaho, Oregon and Montana. The McGregor Company has been a member of TFI since 1972.

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