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The Fertilizer Crisis Impacting California Farmers

Last updated on May 27, 2022

A fertilizer crisis is hitting American farmers and is likely going to disrupt the already tumultuous food supply and supply chain issue.

The main issue impacting farmers is the price of fertilizer, which is hampering their efforts to produce crops for consumers. The impact will likely be felt by Americans in grocery stores in the following year.

According to an Axios report from earlier this month, fertilizer prices are reaching threateningly high levels.

A report by the International Food Policy Research Institute from April showed that market prices for food and fertilizer have gone up over the past year and a half, spiking even more after Russia invaded Ukraine. The prices increased 125% from January of 2021 to January of this year,  and they hit their highest price in March, going up another 17% from January.

A report from the Federal Reserve Bank of Kansas City showed that expenses on fertilizer went up 90% and diesel rose 60% from the year before in February.

The Daily Wire spoke with Bill Diedrich, the president of California Farm Water Coalition, who said that the mixture of the price of fertilizer, along with the issues surrounding water supply, reliability, and shipping “are making it extremely difficult for the small to medium sized grower[s]” who don’t have all of the staff that other large businesses have.

“So the small family guys like myself that farm in that 500 to 1,500 acre range, it’s going to be very difficult to get through it,” he said.

Diedrich says that the price of energy going up, as well as it being less available, will cause nitrogen fertilizer prices to rise, because energy is a “huge component of nitrogen fertilizer.”

According to Diedrich, many farmers in the state are just trying to stay in business, rather than be profitable, specifically if they depend on nut crops and other kinds of crops.

The primary nutrients needed in fertilizer are nitrogen, phosphorus, and potassium. Phosphorus and potassium, which are mined, come from foreign areas. Diedrich noted that many of the mined products come from Russia, which the war in Ukraine has affected.

He said that there is not as much mining of these materials done in the United States, and growers have to find other fertilizer sources.

Diedrich pointed out how “the supply is being regulated by the price,” so as the price increases, growers have to cut back on how much they use. He said sometimes suppliers will let him know ahead of time if prices are going to go up, asking him if he wants to buy fertilizer before that happens.

“But the fact that we’re using less and it’s still scarce tells you that the supply is definitely down,” he said.

He added that he believes Americans will especially feel the impact of the crisis in grocery stores next year, because the non-fresh products grown this year end up in groceries the following year. He said the ingredients used in processed food items aren’t being grown as much and there will be a shortage of processed food. Pointing to the water crisis as well, he said in northern California, there are 300,000 acres of rice that are not being grown because of a lack of water.

Donald Sherman, a small farmer in the Central Valley, said people will either have to get used to smaller fresh food items, or they will have to accept higher costs.

Diedrich noted they had to make decisions based on their own crops as well, noting, “We had to use what little water we had on some of our permanent crops to try and maintain those for better times ahead.”

He said he is most concerned about his employees and the people who work for him.

Regarding what those in power can do to help, he said that California has not placed enough importance on investing in water.

“The truth is that we have a mediterranean climate, obviously, and we have deep rich soils and the resource we need is water,” he said. He said they don’t feel as if the state “has placed enough emphasis on providing a water supply, reliability, and water supply through developing infrastructure, whether it be groundwater banks or surface storage…”

Donald Sherman is farming for the second year in a particular area in Central California, although he has been farming on his own for around 30 years. He told The Daily Wire that the price hike and the availability of fertilizer is affecting farmers. Instead of applying the fertilizer around three or four times per season, it might end up only being applied twice. The reason fertilizer is used, he said, is to assist in sizing the fruit and adding supplement to the vegetables.

“And that’s all important in marketing and selling because sometimes if you don’t have that, if your fruit’s not market size, you lose money,” Sherman said.

He said everyone wants to point to the war in Ukraine as a reason the cost is going up, but he stated that he thinks part of it is labor issues from the pandemic. He also believed people are “taking advantage of situations to make money.”

Sherman has seen this type of shortage with only certain types of fertilizers in the past, but there were other items available then. He said he now has to look “for different forms of nitrogen, cheaper forms, in order to be able to try and get things in that I actually need to get in, but never like this.”

As far as which fertilizers are in short supply, he said he thinks “it’s all the way across the board.”

“Normally, I would put something that had nitrogen, phosphorus, potassium, a triple blend, and that’s way up, that’s way up,” he said.

He said as a small farmer, he has to “count pennies,” especially as fuel prices are also high.

Daniel Hartwig, the president of Fresno County Farm Bureau, said the water situation is “terrible,” and that farmers aren’t getting the water that they need. While they have wells that provide some water, Hartwig said that the wells are seen more as a savings account that they prefer to avoid dipping into unless needed, which is what they’re doing right now.

Hartwig works with Woolf Farming, which was started in 1974. He’s personally been with the group for nine seasons. They farm processing tomatoes, almonds, pistachios, and cotton. Due to the various issues, they have essentially eliminated wheat from their crops because of its low value.

Like some other farmers, he said they are able to get the fertilizers they need, but the cost is the main problem. The fertilizer costs in some situations have more than doubled what they were during the first quarter of last year, he noted.

“The most common fertilizer we use is like a UN 32, which is just nitrogen, and it’s up 74% compared to last year. … If you look at your fertilizer budget and now the cost of that input is, you know, doubled on top of the water costs,” he said. “And the fact that you can’t get parts in for equipment and the parts that you do, you’re paying a premium to get, our costs are just skyrocketing.”

He said the return they’re getting for their crops is not necessarily anywhere close to what their increased costs are.

According to Hartwig, fertilizer is second in kind only to water, and it’s essential to growing crops, saying, “If you try to skimp on the fertilizer, you’re just impacting yourself and how much your crops are going to be able to produce.”

Hartwig said there is a bit of a trickle-down effect when it comes to farming and fertilizer, especially regarding permanent crops like trees, almonds, and pistachios. If they aren’t fertilized, this year’s crop isn’t the only one impacted, but the following year’s crop as well.

When it comes to how the country will feel the effects of the fertilizer crisis, Hartwig said, “The global food system is so interconnected, but everybody is impacted by this, by lack of fertilizer.”

When there are fewer resources, the prices increase, impacting consumers. “And unfortunately,” he added, “the farmer still doesn’t get made whole with what our increased costs are.”

A main issue is the low price that farmers are getting for their product, he said, explaining, “increased cost and prices going down back to the grower, that’s a problem. When farmers are going backwards on what they’re able to get for their crops, that impacts not just the farmer, but impacts all their employees. It impacts the communities that they live in. So, that’s my biggest fear right now.”

When asked about what is causing the low price, he said the culprit is shipping problems, because empty containers are being sent back to Asia.

“And so we have sales that are being made in Asia, and then there’s no way to get those over there,” he said, explaining how they can’t afford to pay the cost of shipping to get the containers there “because they’re paying more in Asia to ship, to send the containers back empty.”

He called it “a huge problem,” noting, “when a big chunk of our demand goes away because it can’t get shipped, it drives down pricing.”

Anecdotally, he added that a lot of family farms end up being the organizations to move away from the region.

When asked his thoughts about the future, he said the biggest need is for things to go back to normal.

“I don’t see things getting back to normal any time soon, unfortunately,” he said, “and that’s really what we need — is kind of [a] return to normalcy.”

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