In a major move to solidify the America First industrial strategy, President Donald Trump signed an executive order on Feb. 18, mobilizing the Defense Production Act (DPA) to secure the domestic supply of elemental phosphorus and glyphosate-based herbicides.
The President officially designated elemental phosphorus as a “scarce material that is critical to national defense and security,” citing its pervasive role in military readiness and agricultural productivity.
The U.S. relies on a single domestic producer—Bayer AG (OTC:BAYRY), which acquired Monsanto in 2018, leaving the defense industrial base and food supply vulnerable to foreign actors.
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By invoking the DPA, the administration aims to curb dependence on imports, particularly from China and Russia, which dominate global production.
The order places Bayer’s U.S. operations, often referred to as its Monsanto division, under a protective federal umbrella.
The directive specifically instructs the Secretary of Agriculture to ensure that no government regulation puts the “corporate viability of any domestic producer” at risk.
Bayer has long been embroiled in litigation over its glyphosate-based Roundup. The company’s Monsanto Unit recently proposed paying $7.25 billion to settle lawsuits claiming that its weed killer Roundup was causing cancer, as per a press release on Tuesday.
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Following the announcement, agribusiness ETFs like the VanEck Agribusiness ETF (NYSE:MOO) and iShares MSCI Global Agriculture Producers ETF (NYSE:VEG) may see increased investor interest as the sector shifted toward a government-protected status.
“Ensuring robust domestic elemental phosphorus mining… is central to American economic and national security,” the order stated.
Beyond farming, phosphorus is a “key input” for defense technologies, including smoke and illumination devices, semiconductors for radar, and modern lithium-ion batteries for weapon systems.
The order delegates presidential authority to the Secretary of Agriculture, acting in consultation with the Secretary of War, to prioritize contracts and allocate materials necessary to “ensure a continued and adequate supply” of these critical inputs.
