Farmers call for probe into fertiliser 'cartel' after price hike

Ronnie Bellew

Fertiliser price hikes announced last week by leading global manufacturer Yara have been slammed as "unwarranted" by the IFA.

Yara increased the wholesale price for CAN by €18/t to €233/t, which is up from €170/t this time last year.

If the latest price increases hold, CAN prices will jump from current farm gate delivered values of €240/t to close on €260/t.

John Coughlan of the IFA inputs project team said there was no economic justification for the price increases given that the main input cost, natural gas, remained stable.

"The substantial and unwarranted price hikes clearly demonstrate that the internal EU fertiliser market is dysfunctional, with Irish and EU farmers being forced to pay the highest fertiliser prices in the world," Mr Coughlan said.

"The continued imposition of anti-dumping measures on ammonium nitrate, in addition to customs duties, on non-EU fertiliser imports is stymying any real competition. This is clearly evidenced by the recent price increases.

John Coughlan
John Coughlan

"Major EU manufacturers are abusing their dominant position by tightly controlling price and supply. They show contempt and a complete lack of respect for their farmer customers."

The IFA argue that the imposition of duties and tariffs by the Commission enables EU fertiliser manufacturers to command a significant premium over world prices, particularly for nitrogen.

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"The Commission must take immediate action and abolish the anti-dumping measures along with the suspension of customs tariffs on non-EU fertiliser imports," Mr Coughlan said.

"In addition, DG Competition must now launch an investigation into the possible operation of price cartels in the EU fertiliser market."

On foot of a complaint lodged by the IFA and seven other EU farming organisations, the EU Commission launched an investigation into the margins enjoyed by EU fertiliser manufacturers arising from the protection afforded by the anti-dumping measures.

As part of this investigation the Commission's DG Trade investigation team conducted a number of visits earlier this spring to EU and Russian fertiliser manufacturing sites. An announcement on the results of this investigation is imminent.

"There's an expectation of increased demand for nitrogen products in the US and South America on the back of improved maize and grain prices this harvest, and that was the main reason for the latest price hike," an Irish industry source said.

Meanwhile, demand for fertiliser this month has been double normal levels, traders report. This is due to increased usage on livestock farms.

Merchants predict that the traditional destocking deals on fertilisers are unlikely to be available to farmers this autumn as a result of the increased sales levels.

Indo Farming

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