Revitalized fertilizer industry will benefit nation

BY SHAWN RANA

Implementation of new technologies within the energy sector has unleashed an energy revolution. Horizontal drilling and advanced hydraulic fracturing have unlocked significant stores of domestic shale oil and natural gas. Access to oil shale resources has significantly lowered North American natural gas prices, and in turn, prompted a manufacturing boom. As more shale gas is recovered, the cost benefit to manufacturers improves, thus providing an optimistic economic outlook.

Inexpensive gas resources have fueled billions in manufacturing investment. Within the fertilizer industry alone, new plant investment is likely to reach $12.7 billion by 2020. In southeast Iowa, OCI N.V. has invested $1.8 billion into the Iowa Fertilizer plant. It will be a natural gas-based fertilizer plant, and will represent the first of its size and class built in this country within the last 25 years. A revitalization of an entire industry has begun. In previous decades, our industry saw companies leaving the United States, in turn, devastating the local communities that relied on the fertilizer company’s business. Now, jobs and facilities are returning to the United States to revitalize local communities, many of which are located in rural areas of the Midwest.

The Iowa Fertilizer facility will transform southeast Iowa and Lee County with the addition of thousands of jobs and increased revenue. The products will provide local farmers with a stable and domestic supply of fertilizer, which will provide significant savings.

While the construction of Iowa Fertilizer is certainly good for Iowa, it represents a larger trend in the United States. Lower energy prices are spurring the return of many companies back to U.S. soil. In a globalized economy, outsourcing jobs has become commonplace. The advanced manufacturing realm has been particularly hard hit, and countless communities have been devastated, primarily in rural parts of the Midwest. Affordable gas, along with the growing demand for fertilizer, has prompted companies like OCI N.V. to build and invest in the United States.

Iowa Fertilizer and other American fertilizer plants create much needed global competition. American farmers have long been forced to import the bulk of their fertilizer from foreign manufacturers. This makes them vulnerable to international price spikes and beholden to companies based overseas. As the No. 1 consumers of fertilizer, and the national leader in corn production, Iowa’s famers have long been forced to pay premium prices for this essential product. This also holds true for our Midwestern neighbors. Healthy competition and a stable supply of affordable fertilizer will save Midwestern famers millions of dollars each year.

At the national level, the country’s fertilizer manufacturing industry is responsible for more than 25,000 jobs and billions in annual investments. The indirect or induced impact of the industry can be linked to more than 200,000 jobs.

The American fertilizer industry is significant, with production plants and distribution facilities across the country. It is a sector with indisputable longevity, and plants providing both immediate and long-lasting revitalization to rural communities most in need. While the industry represents an important component to Midwestern economic stability, a national movement of fertilizer expansion and investment will position the United States to compete on a global scale with foreign companies who have long dominated the market. PB

Shawn Rana President Iowa Fertilizer shawn.rana@iowafertilizer.com

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