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Russia has a new “political weapon”.  The EU is becoming dependent on fertilizer imports

Russia has a new “political weapon”. The EU is becoming dependent on fertilizer imports

Russia has a new “political weapon”.  The EU is becoming dependent on fertilizer imports

The European Union is becoming dependent on Russian fertilizers. There is growing concern in the industry that this will be used as a political weapon. Excessive imports also destabilize the situation of European producers. Financial problems include, among others: Polish Grupa Azoty.

Russia is strengthening its position as a key supplier of fertilizers to the European Union. Since the outbreak of the war in Ukraine, it has dramatically increased its exports. The Fertilizers Europe Association, which brings together fertilizer producers, said that between the 20/21 and 22/23 agricultural seasons, imports from Russia increased by 103%. and in 22/23 it amounted to 137.8 thousand. tone. For example, according to data, in 2022-2023, urea imports increased by 53%. Russia was responsible for 40 percent. this import.

Grupa Azoty in financial crisis

The alarm is sounding, among others: Hubert Kamola, president of Grupa Azoty “Puławy”, which deals with, among others, fertilizer production. – We are currently conducting lobbying activities in this area with representatives of our government to explain the importance of destabilizing the agricultural, fertilizer, industrial and gas sectors – he said at a press conference, quoted by . It deals with, among others: o restrictions on the import of fertilizers. He proposes imposing a 30 percent tariff.

However, the current situation on the fertilizer market is the result of several factors that destabilize the finances of Grupa Azoty. In the first quarter of this year, the company recorded a loss of PLN 146 million. – Liquidity is not at risk – assured Wojciech Szmyła, vice-president of the company, quoted by money.pl.

Russia is destabilizing the situation of European producers

Grupa Azoty is not alone in this problem. The Fertilizers Europe Association believes that “the huge increase in imports of Russian fertilizers has caused damage to EU industry.”

“In September 2021, 70% of the ammonia industry in the EU was temporarily closed. At the beginning of 2023, 40-50% of all ammonia plants in the EU were still closed and only now is the situation almost returning to normal, although 10-20% of production The EU is still in suspension. In recent months, ammonia production plants in the EU have also been forced to close completely,” we read.

Will fertilizers become a political weapon?

Svein Tore Holsether, CEO of Yara International, one of the world’s largest fertilizer producers, warns in an interview that becoming dependent on Russia may affect Europe. – Fertilizers are a new gas – he said. – Russia could use its increased dominance in the fertilizer market to exert political pressure, as it did with energy supplies. When you produce something that is so important to food production, it is a powerful tool. It would be naive to think that at some stage they will not be used for political purposes, he warned.

Moreover, revenues from Russian fertilizers are intended to directly support the Russian invasion in Ukraine. The Fertilizers Europe Association has learned that Russia has introduced a temporary export duty on fertilizers of up to 10%, with the specific purpose of financing the war “effort”. “This means that every tonne of fertilizers exported to the EU directly contributes to financing the war in Ukraine,” the producers report.

Source: Gazeta

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