1000 workers laid-off indefinitely......

[classicalliberal]

The more competition that there is, the quicker the prices will align to where they should be. Unfortunately with the fertilizer manufacturers, there isn't much competition.

[mbratrud]

Our Local retailer is quoting $900 for Potash. We have been using potash in a fairly Substantial way for the last 11 years, but when I can buy 2 tonnes of Urea for every tonne of K. I have enough potash built up from our previous program that I would be crazy to use K I may as well bump up my Nitrogen.

This is going to turn out to be a public relations nightmare for Mosaic. If this isn't a classical example of greed that I am sure in the long run will be a major set back for the company.

Has anyone heard more aggressive Potash numbers? I think part of the problem is these retailers are full of expensive product.

[jensend]

the lack of competition is the biggest problem facing farmers today imho.




TIME Magazine
October 28, 1996 Volume 148, No. 20
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THE FIX WAS IN AT ADM

A RECORD $100 MILLION FINE FOR RIGGING PRICES MAY ADD UP TO THE END OF THE
ANDREAS FAMILY DYNASTY

JOHN GREENWALD

No one expects Archer-Daniels- Midland to change its advertising slogan from
"Supermarket to the World" to "Price Fixer to the World." But that sobriquet
would fit in the wake of the agribusiness giant's $100 million plea bargain
last week with the Justice Department.

After years of denying any wrongdoing, the company pleaded guilty to conspiring
to fix prices for the livestock feed-supplement lysine and for citric acid, an
additive found in products from cosmetics to soft drinks. The $100 million
fine, the largest ever levied in a criminal antitrust case, was more than six
times the amount of the previous record settlement. Further, ADM will pay an
additional $90 million to settle civil suits. "In essence, greed, simple greed,
replaced any sense of corporate decency or integrity" at ADM, said Joel Klein,
the acting Assistant Attorney General for antitrust.

The plea bargain turned ADM (1995 sales: $12.7 billion) into an informer for
the government. In exchange for immunity, company officials agreed to become
witnesses against other firms under investigation for conspiring with ADM to
rig prices in the $1.2 billion citric-acid market.

ADM employees may also be called on to testify against their own, notably
executive vice president Michael Andreas, 47, longtime heir apparent to his
father, ADM chairman and CEO Dwayne Andreas, 78. Prosecutors are continuing
their investigation of both the younger Andreas and Terrance Wilson, 58, who
heads the ADM corn-processing division. Neither was granted immunity--meaning
that both could face indictment. ADM said last week that Andreas was taking a
leave of absence and that Wilson had decided to retire.

Importantly, the Justice Department will not pursue a potentially larger case
against ADM for fixing prices in the market for high-fructose corn syrup, a
ubiquitous soft-drink sweetener. This $4 billion industry is nearly four times
the size of citric acid, and some consumer advocates have charged that shoppers
pay higher prices for soda because of ADM's practices.

The Justice Department's case hinged on a company executive turned FBI
informant, Mark Whitacre, who secretly taped meetings that allegedly included
the younger Andreas, Wilson and executives of rival companies. "The competitor
is our friend; the customer is our enemy" was a favorite saying around ADM,
according to Whitacre. Such talk ended when the feds raided ADM's Decatur,
Illinois, headquarters in June 1995. Although the company fired Whitacre and
charged him with embezzlement, which he denies, and although Whitacre later
attempted suicide, the case was strong enough to force ADM's directors to
capitulate.

The plea bargain was a public humiliation for Dwayne Andreas, a political
insider who has funneled millions in corporate contributions to Republican and
Democratic candidates. Andreas has particularly close ties to Bob Dole, who has
used ADM corporate planes for campaign trips and vacationed with Andreas in Bal
Harbour, Florida; Dole and his wife Elizabeth purchased an apartment there from
Andreas. Dole has championed myriad agricultural subsidies that have benefited
ADM. With Dole's support, Washington has paid out more than $6 billion in
subsidies since 1980 for ethanol, the corn-based fuel that ADM makes; it holds
a 65% share of the $1.5 billion ethanol market.

Andreas had to face down a shareholder revolt last week at the ADM annual
meeting in Decatur. Declaring that "as Harry Truman said, 'The buck stops with
me,'" the chairman apologized for the scandals. Nevertheless, the settlement
put paid to an era at ADM, which Andreas and his family have dominated for 30
years. It appears unlikely that Michael Andreas will ever succeed his father.
"Even if this is not the end of ADM," says a close business associate of
Dwayne's, "this could well be the end of the Andreas reign."

For the company, last week's penalty represented little more than peanuts--or
soybeans--and was a good deal, considering that ADM benefited financially in
the form of higher prices. The company has $1.3 billion on hand to pay
inconveniences like a $100 million fine. ADM's stock even rose $1.13 a share,
to $21.75, on news of the penalty--which Wall Street had expected to be much
higher--and finished the week at $21.50, raising the company's market value
some $500 million. By that accounting, it can't be said that crime doesn't pay,
only that it is a cost of doing business.

--Reported by Sally B. Donnelly/Washington and William A. McWhirter/Chicago