Why we need a strong European fertilizer industry?

 

Fertilizers

– a critical industry for Europe

Fertilizers enable 50% of European food production, contributing to food security in Europe and beyond.

In doing so, the industry is essential to providing European consumers with nutritious, affordable, and sustainable food, supporting the objectives of the EU Farm to Fork strategy.

Furthermore, the fertilizer industry produces about 40%* of the total of European hydrogen as raw material of ammonia production. It is therefore also uniquely placed to contribute to the objectives of the EU Green Deal and the development of a hydrogen economy in Europe.

*Source: AFRY MANAGEMENT CONSULTING , Hydrogen Development in Europe and Middle East, 2021,

50% of European food production

40% of the total of European hydrogen production

European Fertilizers industry is doing its outmost to continue supporting farmers and guarantee long term food security

The European fertilizer industry is committed to being a reliable partner in ensuring food security and sustainability in Europe. The industry  part of the European Food Security Crisis Preparedness and Response Mechanism, an initiative to ensure food security in the EU. We are doing our outmost to supply farmers with fertilizers for the new season, despite the difficult economic situation.

However, regions with low nitrogen application rates, are likely to suffer most in case of insufficient nutrient application, which will lead to lower yield and quality.

Due to the almost 300% increase in gas prices, European farmers have seen the cost of fertilizers go up by 142%, increasing overall input costs. In parallel, crop prices have also risen considerably: wheat 22%, maize 17% and rape seed 73%, making it possible for farmers to compensate the higher input costs.*

The recent invasion of Ukraine and the sanctions on Russia have created extra challenges to the already difficult situation faced by the industry.

*Source: DG AGRI, PRICE DASHBOARD (January 2022 report) 

 

 

Record-high gas prices are severely impacting the European fertilizer industry with potential consequences for European food security and strategic autonomy

With record high prices and gas representing up to 90% of the variable costs in fertilizer production, the situation has become unsustainable for our industry in Europe. Meanwhile, most non-EU producing countries have access to artificially low, state-fixed priced gas and are thus profiteering from the artificial price gap.

The invasion of Ukraine and fertilizer export bans in third countries has shown that the EU should reduce its dependence on material imports from external actors. European Commission initiatives such as REPower EU is a crucial reminder that we need to take action to safeguard European autonomy.

Less dependence on external actors will contribute to stable local fertilizer production and long-term food security.

Source: The World Bank Data (in US$/mmBtu). Retrieved on the 3rd of March 2022.

Source: The World Bank Data (in US$/mmBtu). Retrieved on the 3rd of March 2022.