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Iowa Ag News Headlines |
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AG, Environmentalists Oppose Koch Industries Purchase of Iowa Fertilizer Plant
Iowa Ag Connection - 01/24/2024
Agriculture and environmental groups have asked the federal government to investigate Koch Industries' planned $3.6 billion acquisition of OCI Global's Iowa Fertilizer Company, expressing concern the transaction would further concentrate the fertilizer industry.
Koch announced the planned acquisition in December, saying in a news release it would have 100% ownership of the facility located along the Mississippi River in southeast Iowa in the town of Wever.
The plant opened in 2017 and has the capacity to produce 3.5 million metric tons of nitrogen fertilizers and diesel exhaust fluid annually.
Though fertilizer prices have come down in the past year, agriculture groups have called for expanded domestic production to help alleviate supply issues.
"IFCO was built with substantial local, state and federal investment, with its proponents citing the opportunity to challenge Koch Industries' dominance in fertilizer markets," the ag and environmental groups said in a letter to the Federal Trade Commission and the Department of Justice.
"Should the acquisition be allowed to proceed, taxpayers will have effectively subsidized the expansion of Koch's control over a critical and heavily concentrated sector of our agricultural economy. The IFCO plant currently employs more than 250 workers and produces approximately 2 million tons of fertilizer annually."
Signing the letter were R-CALF USA, National Farmers Union, 20/20 Vision, American Economic Liberties Project, American Grassfed Association, Campaign for Family Farms and the Environment, Family Farm Defenders, Farm Action, Farm and Ranch Freedom Alliance, Food and Water Watch, Iowa Citizens for Community Improvement, Institute for Agriculture and Trade Policy, Institute for Local Self-Reliance, National Family Farm Coalition, Open Markets Institute, Revolving Door Project, Sooner Food Group and Union of Concerned Scientists.
The groups said when the plant was proposed in 2012, it was "anticipated to decrease fertilizer costs" for farmers by "introducing competition into the highly consolidated" fertilizer industry.
"The promise of jobs and a stable, domestic source for nitrogen enabled the plant to garner the largest tax incentive package in Iowa's history: $133 million in local giveaways, another $112 million in state giveaways, and an estimated $300 million in federal tax giveaways," the letter said.
"The unrestricted federal funds left the door open for Koch Industries to purchase the company just six years after the plant opened."
The groups pointed to recently updated merger guidelines from the FTC and DOJ that, among other things, said mergers "raise a presumption of illegality" when they increase concentration in industries that already are concentrated.
Click here to read more iowacorn.org
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