Copa-Cogeca has welcomed the European Commission “finally” opening an investigation on import duties on liquid urea-ammonium nitrate (UAN) fertilisers.
For several months, Copa-Cogeca has been questioning the “usefulness of the anti-dumping measures applied at European level on UAN fertilisers“.
“With record prices this winter, and the situation becoming increasingly untenable at farm level, DG Trade has decided to open an investigation on the actual impact on those anti-dumping duties.
“Copa and Cogeca welcome this first step which could lead to the removal of anti-dumping taxes and ask the European Commission to act swiftly.”
Rising global fertiliser demand
The European lobby group said that since the beginning of 2021, nitrogen fertiliser prices “have tripled”.
“They now represent 55% of the input costs of crop farmers in Europe. In addition to this increase, the volumes offered in the off-season have been lower than usual and already distributors are not sure they will be able to meet all farmers’ demands by the spring-use period in many member states.
“These conditions greatly compromise the production capacities of crop farmers, who are exposed both to the volatility of the international crop market and to distortions of competition with other farmers worldwide on an excessively protected European fertiliser market.
“The price of fertilisers, especially nitrogen solution, is connected to rising global fertiliser demand and gas and sea freight prices, as well as insufficient competition in the EU domestic market.
“What is less often understood by the public is that the customs barriers on nitrogen and anti-dumping taxes on UAN in place at EU level have become a major obstacle for farmers and expose them to excessive prices and a real risk of supply shortages.
“Meanwhile, European fertiliser industries, who experience both high production costs and high selling prices, continue to make excessive margins.”
Critical situation on farms
Reacting to the opening of the investigation by the European Commission on import barriers protecting the fertiliser sector, Tim Cullinan, IFA president and Copa vice-president said:
“This is a first step; the commission has decided to listen to the concerns expressed by the farming community about the overprotected fertiliser market.
“With UANs prices of over 750€/t, there is a clear need for rapid action as the situation remains tense in several member states.
“We therefore hope that the investigation launched by the European Commission can be concluded within a timeframe that considers the critical situation on farms.”
Copa-Cogeca, supported by IFA, lodged a complaint with DG Trade at the end of April.
This resulted in an investigation being opened to see whether fertiliser manufacturers would suffer “a threat of injury” should the anti-dumping measure on UAN be suspended.
Farmers “contend that excessive profits achieved by fertiliser manufacturers, represented by Fertilisers Europe, means such a threat is unfounded”.
Meanwhile, it is estimated that the annual cost to EU farmers from the UAN anti-dumping measure alone ranges from €545 million to €1.1 billion.
“Agriculture Minister Charlie McConalogue rightly highlighted the current fertiliser crisis and the need to address anti-dumping measures during Monday’s Agriculture Council meeting,” Cullinan continued.
“It is imperative that farmers have their voices heard by commission officials. Current fertiliser prices, which have more than doubled in the past 12 months, are not sustainable and are now at a level that threatens European food production.”
MEPs will get their opportunity to question the commission during an exchange of views on fertiliser anti-dumping measures in the Agriculture Committee on November 30.