CropLife Retail Week: Tariff Refunds and Shifts, Planning Strategies and Glyphosate Price Hikes?

In this episode, CropLife Editor Eric Sfiligoj sits down with industry experts Jim Delisi, Chief of Fanwood Chemical and Jeff Pritchard, Chief Executive Officer for WestLink Ag Group, to outline what current volatile global market shifts mean for your ag retail operation’s bottom line. Discover the hidden realities behind the $104 billion tariff refund bottleneck, the threat of retroactive generic glyphosate duties, and how a flood of post-patent generic entries is tanking chemical market value by 23%.

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*Below is a partial and edited transcript:

Eric Sfiligoj

Welcome to a special edition of CropLife Retail Week. I’m Eric Sfiligoj, Editor of CropLife and CropLife IRON, here with two guests this week: Jim DeLisi from Fanwood Chemical and Jeff Pritchard from WestLink Ag. Gentlemen, welcome back to the program.

Jim DeLisi

Nice to be here.

Jeff Pritchard

Yeah, thank you.

Eric Sfiligoj

I wanted to talk a little bit about what’s going on in the world of current events. We wanted to touch on how tariffs and trade volatility are reshaping the cost of doing business in ag retail and, more importantly, who pays and who’s benefiting from the situation.

I’ll start with you, Jim. I had you on Retail Week not too many weeks ago, and we talked about the whole tariff refund situation. Could you give us the latest on that and explain how it’s impacting ag retailers, if at all?

Jim DeLisi

The best number I can find is that $104 billion in refunds have been approved, and about $75 billion has been paid out. Of course, not a small percentage of that went for agrochemicals.

Jeff can better talk about what his experience has been trying to pry refunds out of his suppliers, but the money is flowing.

There’s still no update. As we talked about last time, the administration has appealed the decision to issue refunds for imports that have liquidated, which would be about half of the total. That’s still working its way through the court system. It will probably take six months, a year, maybe longer for that to settle.

But $104 billion has supposedly been sent back into the economy, with probably another $50–60 billion to go for entries that had not liquidated.

I’d be interested to hear from Jeff whether he’s having any success getting refunds from suppliers.

Jeff Pritchard

Good question. The blunt answer is no.

I think a lot of suppliers are still trying to reconcile how they’re able to apply that at a transactional level with companies like mine. We’re talking to them about it and doing a little of our own tracking, but we haven’t seen much impact on pricing due to rebates or tariffs.

Prices have stayed fairly low throughout the last two or three years, at least on the generic side where we deal almost exclusively. It’s hard for suppliers to identify what portion of their sales is associated with tariff increases on their costs.

With so much inventory in the market over the last two to three years, prices have stayed compressed across the major high-volume agrochemicals, especially on the generic side.

Jim DeLisi

That confirms that a lot of the tariff increases were absorbed within the system.

If you import an active ingredient and pay a tariff on it, by the time it gets formulated, diluted, packaged, and shipped, the actual tariff increase becomes greatly diluted throughout the supply chain.

Now, I wouldn’t say that was the case when tariffs on China briefly exceeded 100%. That’s a significant hit. But when tariffs are 20–25%, the impact gets diluted enough that it can sometimes be hard to find.

Eric Sfiligoj

With all that in mind, what’s happening with the global supply chain?

Jeff, when you were on previously, we talked about how the situation involving Iran and shipping routes was affecting the fertilizer supply chain. What’s going on with crop protection? Is it also being impacted by this uncertainty? And how are your members at WestLink dealing with it?

Jeff Pritchard

We’re dealing with this in the middle of July, right in the middle of the season, while regrouping and preparing for 2027.

A lot of product has already moved through the channel and been applied in the field. I think there’s still a lot of uncertainty at the retail level about where prices are headed.

We’re just starting to receive fill programs from suppliers. Some are very aggressive with incentives. More than anything else, inventory is driving behavior. Some companies are more focused on cash flow than profitability and simply want to move inventory.

There’s also a tremendous amount of behavioral pricing. That’s difficult to measure because suppliers will immediately match or beat a competitor’s price if they think they’re going to lose business.

I think a lot of companies are trying to jump into 2027 early and offer programs now in an effort to secure as much revenue as possible before whatever happens in Q4 and Q1 of 2027.

Jim DeLisi

I’d add two things from the import side.

The so-called 122 tariffs expire on July 24. It had been expected that the new Section 301 investigation on forced labor would result in tariff rates taking effect before that expiration. As of today, there are no conclusions from that investigation.

There was a hearing about a week ago, and they haven’t finished reviewing the testimony. A number of countries have also come to Washington to argue they are not using forced labor. India, in fact, recently passed legislation banning imports produced with forced labor, which addresses one of the investigation’s primary goals.

So if you ask me what tariffs will look like on July 25, the answer is: we don’t know.

The other issue is the glyphosate case. That will probably take another year to finalize, but Bayer Crop Science has argued for circumstances that would permit 90-day retroactive tariffs. We could theoretically be within that window before the end of this month if everything stays on schedule.

You can expect tariffs on Chinese glyphosate to be significant. Whether they’ll match those imposed on Chinese 2,4-D remains to be seen.

Anyone interested can watch the public hearing on July 21 through the U.S. International Trade Commission website.

Eric Sfiligoj

Interesting. Jeff, any thoughts?

Jeff Pritchard

We’re seeing very limited activity from suppliers that provide glyphosate because they’re waiting for the Bayer situation to play out.

I don’t expect much movement with other products, but if Bayer succeeds, we’ll probably see glyphosate prices from generic suppliers roughly double from current levels.

At the same time, we probably won’t see similar movement with glufosinate, which is an acceptable replacement. My company alone has over 20 suppliers offering the same formulation of glyphosate, and prices remain compressed.

Earlier this summer, we looked at major off-patent products like glyphosate, glufosinate, dicamba, 2,4-D, azoxystrobin, propiconazole, bifenthrin, and lambda-cyhalothrin. Compared with post-COVID pricing in 2022, we found an overall market value decline of about 23%, driven almost entirely by price decreases.

That’s roughly three-quarters of a billion dollars in market value that’s disappeared due to lower prices.

At the retail level, we’re making decisions day by day. We’re not looking too far ahead because prices remain so compressed. We don’t need to build accelerated inventory positions, with the exception of glyphosate because of Bayer’s actions.

Eric Sfiligoj

Jeff, you mentioned alternative products.

Shortly after the Supreme Court rendered its decision regarding the glyphosate case, EPA approved several new active ingredients for the 2027 growing season, including one from Bayer.

Will these new active ingredients help or hurt the crop protection market we’ve been discussing?

Jeff Pritchard

It depends on what they are. I won’t claim to follow every approval closely, although I did hear about them.

What we typically see is that once products come off patent—like prothioconazole or spirotetramat—the number of generic entrants is incredible and happens very quickly.

In the case of prothioconazole, there were ten new entrants within a year of patent expiration, and we do business with seven or eight of them. That kind of competition causes rapid price declines.

As for truly new active ingredients, I probably won’t see those for a couple of years at WestLink Ag. The products currently available already address nearly all fungal, insect, and weed challenges in the U.S. market.

We’ll see whether these new products offer better resistance management, greater stability, or easier tank mixing.

Eric Sfiligoj

Before you weigh in, Jim, let me follow up with Jeff.

Over the last 20 to 30 years, I’ve written stories comparing the generic marketplace in the U.S. with Europe, where generic adoption has traditionally been much higher.

Are you saying that ag retailers’ hesitation toward generics has changed over the years? If so, what do you attribute that to?

Jeff Pritchard

If you’re talking about resistance to generics versus branded products, I think that resistance disappeared at least ten years ago, maybe longer.

Retailers are much more comfortable with generics today. I don’t think it’s an issue anymore.

The only hesitation may come from the farm gate, where a grower prefers a brand because they know the representative or simply feel more comfortable with the original product.

At WestLink, we speak the language of generics almost exclusively.

These companies invest tremendous effort to earn registrations demonstrating substantial similarity to branded products. Quality generally isn’t an issue. Occasionally there are packaging problems, but branded products have those too.

The farm economy is also driving this trend. Generic products are usually much less expensive, and that’s important for growers focused on managing input costs.

Eric Sfiligoj

I appreciate that, Jeff.

Sorry, Jim—I didn’t mean to interrupt, but I wanted to follow up before I lost my train of thought.

Jim DeLisi

No problem.

I was just going to add that the first significant quantities of prothioconazole technical material arrived in the U.S. from China in July.

Jeff Pritchard

Exactly. Since it came off patent, we already have five generic entrants in the marketplace, including the original registrant, and we’re already receiving pricing information.

Jim DeLisi

The technical material is here now for formulation in the United States, and formulated products started arriving a couple of months ago.

Eric Sfiligoj

As we wrap up, I’d like to look ahead.

Jeff, you mentioned planning for 2027. What advice would you give retailers? What two or three steps can they take to safeguard their businesses as they prepare for next season?

Jeff Pritchard

Retailers need to have constructive discussions with suppliers about total supply in the marketplace.

They should maintain a broad supplier base. Unlike fertilizer, crop protection is still a highly competitive market with many suppliers seeking access.

Having multiple suppliers is a real advantage because it allows you to compare opportunities fairly.

With a few exceptions, supply is generally adequate. I don’t think retailers need to rush into purchases out of fear they’ll run out of product later.

If an attractive early-pay program comes along, we recommend checking with other suppliers to understand their inventory positions and market goals before making a decision.

I also think retailers need to know their farmer customers even better than they have in the past.

Farmers have much greater access to market information today and understand pricing trends almost as well as retailers.

At the same time, commodity prices remain challenging. We’ve had favorable weather and what looks like a strong crop, but if the farm economy doesn’t improve heading into 2027, retailers need to understand their customers’ financial situations to avoid problems down the road.

Eric Sfiligoj

Jim?

Jim DeLisi

I’d add that there are a lot of geopolitical factors affecting this business because most active ingredients, or their key components, are imported.

Retailers should pay close attention to international trade and the Trump administration’s trade policies.

As I mentioned earlier, we have a major tariff milestone on July 24, and we still don’t know exactly what will happen.

Keep your eyes and ears open. Inventory is probably your friend, and buckle up for a bit of a roller coaster ride—especially if you’re heavily involved in glyphosate.

Eric Sfiligoj

We haven’t even touched on the U.S.-Canada-Mexico trade agreement, since that appears to be moving toward an ongoing negotiation rather than a long-term agreement.

Jim DeLisi

The administration’s current position is that it wants separate bilateral agreements—U.S.-Canada and U.S.-Mexico.

Canada and Mexico want to keep the agreement trilateral.

It will take some time to see how that develops. Ambassador Greer is scheduled to testify before the Senate Finance Committee next week, so we may learn more then.

Eric Sfiligoj

Very good.

We’ll certainly have you both back as developments continue. Based on today’s discussion, it sounds like there will be plenty to watch as retailers plan for next year.

Jim and Jeff, thank you both for joining us for this edition of CropLife Retail Week. We appreciate your insights.

And thanks to all of our viewers for watching. We’ll see you again next week.