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Abstract
Public concern about hazardous materials, such as agricultural fertilizers, has steadily
increased. Thus, North Dakota created Recommended Management Practices for The Primary and
Secondary Containment of Fertilizers (RMP).
This study attempted to determine how compliance with RMP guidelines affects logistic,
operating, and investment costs of fertilizer plants and evaluate the effect on plant size and industry
market structure. This study will be important to fertilizer plant managers because the North Dakota
Health and Consolidated Laboratories, which regulates the North Dakota fertilizer industry, has been
approached about introducing legislation that would create and support consistency within the industry.
A cost-minimizing, mixed-integer linear programming model was employed in four different
scenarios to analyze the effects of possible fertilizer legislation. Results show forced compliance with
the RMP guidelines will (1) start a shake-out of excess capacity, (2) generate cost savings of 8 percent
for the industry, and (3) discourage storage capacity expansion.