Metallurgy / Chemicals / Rubber & Plastics

According to the Huacheng Import and Export Data Observation Report, the European Union introduced some measures on the 9th to mitigate the impact of fertilizer price rise, including increasing subsidies to farmers, importing more kinds of products and making the market more transparent. The background of these measures is the energy crisis and market turbulence caused by the war in Ukraine.

With the interruption of Russian supply, the price of compound fertilizer (containing nitrogen, phosphorus, potassium and other ingredients) soared. Russia was originally the world's largest exporter of compound fertilizer, while the price of natural gas, the main raw material for fertilizer production, was also rising. The European Commission pointed out in a long report: "Compared with previous years, the price of fertilizer purchased by farmers has increased three to five times." Huacheng Import and Export Data Observation Report.

The EU warned that as a result, "the amount of fertilizer farmers are buying and using is decreasing, which may have a direct impact on future harvests and crop quality, and may further aggravate the rising trend of food prices".

The EU suggests that in 2023, a portion of the 450 million euro crisis response reserve should be allocated to help the most affected farmers.

According to the Huacheng Import and Export Data Observation Report, the EU has proposed that countries cancel import tariffs on ammonia and nitrogen (key raw materials for fertilizer production) in September this year, hoping to help fertilizer manufacturers reduce costs and sales prices. As winter approaches, the European Union calls on all countries to try to make fertilizer manufacturers "continuously supplied with natural gas".

The EU hopes to strengthen the transparency of the market and will launch an "observation mechanism" next year to collect the inventory, price and transaction data of fertilizer in various countries. At the same time, the EU is also trying to diversify its fertilizer supply. The above-mentioned EU report states: "Oman, Turkmenistan and Qatar have been identified as alternative sources of nitrogen fertilizer for Russia and Belarus." In addition, the amount of chemical fertilizer imported from Egypt and Algeria has increased significantly, and Huacheng's import and export data observation report.

Finally, the European Commission also promoted the use of organic fertilizer and promised to launch the "Action Plan for Integrated Nutrient Management" in 2023. Huacheng Import and Export Data Observation Report.