The opening of the US market will allow Russian companies to diversify sales of fertilizer, but the United States may soon face an oversupply as new fertilizer producing facilities go on-stream.
“I don’t think this relief will last long because US lobbyists always do what is best for America. What we see now is a clear sign of their support for the local chemicals industry, which now needs raw materials from Russia, Sergei Sudakov said.
The fertilizer market is highly competitive, and in the coming years US manufacturers will open a large number of new facilities, which will reduce imports.
“Still, this is good news for us as it means that the US lobby groups are working with Russian, not, say, Indian manufacturers,” Sergei Sudakov told Sputnik.
He added that the ongoing presidential race in the US could also have played a role here.
“The presidential campaign has hit the home stretch now and [Democratic hopeful] Hillary Clinton is a clear favorite. That’s why many in the Democratic Party have been forced to ask the lobby groups to try to mend business, not political, fences with Russia just to gain additional points in the race,” he noted.
“I think that [Russian manufacturers] will make a good deal of profit too. Even though the terms of these contracts remain under wraps, I guess that the Americans are going to buy a lot because otherwise the lobby groups would have never come into play. When contracts are in the ballpark of just a few tens of millions of dollars, they are simply not interested,” Sergei Sudakov said in conclusion.
The decision to lift import duties on Russian fertilizer comes into force on August 20.
Since 2010, the US fee imposed on Russian fertilizer imports has been 253.98% reviewed once every five years by the Department of Commerce.