December 25, 2024 | 12:45 GMT +7
December 25, 2024 | 12:45 GMT +7
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Brussels has come up with a rescue plan to ensure European farmers can obtain fertilizers needed to grow food for a world on the brink of a full-blown hunger crisis.
Only it seems no one — apart from the Commission itself — thinks the plan will actually work.
“This new communication simply [fails] to provide concrete answers to the shortcomings faced by European farmers,” the EU’s largest farmers and agri-cooperatives lobbying alliance Copa & Cogeca said in a statement.
“I haven’t seen anything in this communication that gives us predictability,” said Svein Tore Holsether, CEO of Yara International, the world’s largest fertilizer manufacturer, referring to the highly volatile prices of natural gas required to produce them.
The EU is hugely dependent on imports of fertilizers because it lacks essential inputs like natural gas, which is both a key ingredient and an energy source for the production of nitrogen-based fertilizers, as well as phosphates and potash.
For now, chemical fertilizers remain available in the EU, but their prices have shot up by as much as 149 percent since September of last year, driven in part by the crippling of supplies in the aftermath of Russia’s invasion of Ukraine. Before the war, Russia and Belarus accounted for around 60 percent of the EU’s fertilizer needs.
The Commission’s plan, unveiled Wednesday, is the brainchild of Agriculture Commissioner Janusz Wojciechowski, who first pitched it in early October. The final text confirmed reporting in POLITICO's Morning Agriculture & Food newsletter. It outlines already existing public support measures and funding, including the Common Agricultural Policy, that national capitals can use to help farmers access — and afford — fertilizers in the immediate future.
But farmers aren’t convinced by what this actually entails.
“The Commission passes the buck … to the member states through state aids and CAP strategic plans,” said Cogeca President Ramon Armengol. “This could create significant distortions depending on how member states react. Fertilizers are a key input in agriculture, not … having a clear answer on this point is deeply concerning.”
Watered down
An earlier version of the plan had said Brussels would call on national capitals to ensure fertilizer manufacturers can obtain natural gas to keep their production lines running, with the hope that this could help further reduce prices and avoid the kind of disruptions further down the supply chain witnessed earlier this summer.
But the adopted text is no longer as explicit, with the Commission instead “pointing out” that member states “may prioritise the continued and uninterrupted access to natural gas” for fertilizer producers “in their national emergency plans in the event of gas rationing.”
Yara’s Holsether said the proposed measures “aren’t clear enough.” A company spokesperson added: “We are disappointed that the reference to the availability of gas for fertilizer production in the event of rationing is not stronger.” Jacob Hansen, director general of the lobby group Fertilizers Europe, added that "a more comprehensive strategy is needed."
The crunch on nitrogen-based fertilizers isn't the only issue farmers in Europe have been grappling with. While they account for around 65 percent of all fertilizers used in the EU, the bloc also imports significant amounts of mined fertilizers like phosphate and potash, which before the Ukraine war came primarily from Belarus and Russia.
Copa & Cogeca, as well as various lawmakers in the European Parliament, have been calling on Brussels to secure supplies from other countries and remove anti-dumping duties on imports of fertilizer from countries like Trinidad and Tobago and the U.S. But the final text ultimately sides with the concerns raised by European manufacturers, with Wojciechowski saying that while this "would be effective in the short term ... we cannot risk our industry being impacted by their lifting."
In the long run ...
Ultimately, Brussels wants farmers to start applying fertilizers more efficiently, with the goal of reducing synthetic fertilizer use by 20 percent by 2030. Fertilizers are notoriously overapplied across the EU, but there is a limit to how much nutrient crops can take in — a study in Germany found that only 61 percent of fertilizer is reaching wheat crops, while the rest is wasted.
The plan “makes the point that ultimately we need to reduce our reliance on synthetic fertilizer in the long run … [but] the headline measures will likely increase our reliance on synthetic fertilizers and increase European production via a combination of subsidies and price supports,” said David Kanter, a New York University professor who leads the research group International Nitrogen Initiative, which is also active in the EU.
Environmental NGOs were also unimpressed, with Célia Nyssens-James from the European Environmental Bureau calling the Brussels plan “a big gift to the fertilizers industry.” She added that the subsidies for farmers are a “misguided quick fix which will not solve the fundamental problem of our reliance on fossil fuels and fertilizer imports; nor any of the environmental issues linked to the overuse of fertilizers in Europe.”
While farmers in the EU have been reluctant to buy fertilizers at current high prices, those in the low- and middle-income countries across Sub-Saharan Africa and parts of Asia have cut down further on their already limited use. The United Nations warned recently that, unless urgently addressed, the fertilizer crisis could push even more people across the Global South to the brink of starvation next year.
The plan outlined by Brussels contains an entire section on how the EU can help address the global challenges, but “does not provide much [in terms of] innovative solutions beyond continued cooperation with relevant stakeholders," including the U.N. and the World Trade Organization, said Antoine Oger, from the Institute for European Environmental Policy, a Brussels-based sustainability think tank.
All in all, it seems Brussels’ much-anticipated rescue plan ultimately satisfies — and helps — no one.
(Politico)
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