Perimeter Solutions’ domination of fire-retardant market raises cost and supply concerns

When wildfires rage across the western US, the red clouds trailing from firefighting planes are a sign of hope—yet also the result of a worrisome market monopoly, reports the New York Times. Perimeter Solutions is now the sole supplier of long-term fire retardant for federal and most state agencies. As wildfires become more frequent and severe, the company’s dominance has driven both the cost and supply risk higher for government agencies and taxpayers.

Perimeter's near-total control originated in 2005, when US Forest Service concerns over toxicity excluded its last major competitor’s produc. With the company now managed by investors experienced in "value-based pricing," fire retardant prices surged 20 to 30 percent in California since 2021, and federal spending has more than doubled, topping $250 million in 2024.

Perimeter executives say these increases reflect inflation, logistics costs, and new responsibilities to maintain resilience. Meanwhile, a 2022 Department of Agriculture memo labeled the government’s reliance on a single source a “massive risk”—referencing supply chain vulnerabilities highlighted by incidents such as the 2022 baby formula shortage.

Attempts to diversify the supply chain have met steep hurdles. Government approval for new retardants requires not only proving fire suppression effectiveness, but also confirming safety for aircraft, firefighters, and the environment—sometimes taking years of lab and field tests. When a California start-up, Fortress Fire Retardant Systems, finally passed Forest Service tests, equipment malfunctions—possibly linked to chemical mixing—delayed its adoption. Meanwhile, Perimeter doubled its lobbying spend and publicly questioned Fortress’s safety. By early 2025, Fortress had exited the sector.