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1 1 (March 6, 2023)

handle is hein.amenin/aeiaenl0001 and id is 1 raw text is: Key Points * From late 2020 throuqh mid-2022. prices fcr nitrogen, phosphorous, and potash tbrtiiizers more than doubled for several reasons, sorne of which wene a direct result of Russia's invasion or Ukraine and others pany associated with COVID-I9 supply-charn disruptions. Beginning in mid-to-late 2022, fertilizer prices have been falling as CVID-! 09-related suppry disruptions have moderamed, agricultural commodity prices have fallen, and prices for natural gas, a key input for nitrogen fertilizers, have dropped sharply. This trend seems likely to continue in 2C'3. * US policyrnakers. can also affect FertIzer prices V furt'er reducing tariffs and trade restrictions on fertilizer imorrts, th reby increasing incentives for farmers to inncrase yields, crop procluction, and farm incomes. When the US inflation rate is relatively high, as has been the case over the past i5 months, many media comnIenters tend TO opine that the price 0f any connnodity can only go higher never rower. In fact, the definition of Inflation is a general rise in the overall cost of a basket of goods and services that consumers typically purchase. Thus, even during a period of inflation, markets and prices for individ- ual products or services can behave differently from one another. For example, over the past nine months, prices for the three major forms of fertilizer-nitrogen, phosphate, and potash-have vividly demonstrated that what has gone up can come down, if there is sufficient competiion between firms and if gov- ernment attempts to manage markets are kept at bay. Recently,, we examined the causes of the rapid rise in fertlizer prices that occurred in 2021 and throughout much of 2022. Since then, however, those prices have begun to decline, an outcome entirely consistent with well-functioning markets in which both supply and deman d conditions have changed. Fertilizer Prices, Agricultural Production, and the 2023 Farm Bill Fertilizer prices are important for farmers, both in tne United States and abroad, because fertilizers enhance soil nutrients that are essential for plant growth. 'These nutrients substantially inc:rease crop yields and farm incomes. Furthermore, the use of fertilizers has greatly reduced hrnger and the amount of income spent on food. Nevertheless, other things being equal, higher fertilizer prices cause farmers to reduce thcir use, with resulting declines in yields and crop produc- tion. In addition, higher fertilizer prices cause farm

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