Debate: Communication on ensuring availability and affordability of fertilisers
Date: WEDNESDAY, 9 NOVEMBER 2022
Speaker: Janusz Wojciechowski
Language: EN

Fertiliser prices, fertiliser costs, this is a very sensitive problem for our farmers. I would like to present the free numbers about the price of fertilisers. The increase of the price for nitrogen fertilisers: 149 %, when comparing September 2021 with 2022. The increase of the price for phosphate rock: 254 % compared to the 2016-2020 average. The increase of the price for potash minerals, compared with the same period: 141 %.  We can observe the increase of input costs for the farmers. According to Eurostat data, comparing the second quarter of 2021 to the second quarter of 2022, the increase in agricultural input costs is almost 40 %. This is the EU average. At the same time, the increase of the agricultural output, the price of the agricultural products, is about 25 %. The increase of the price of products does not compensate for the farmers’ increase of input costs. Only in three Member States can we observe that the increase of inputs was compensated by increase of the output. These are Estonia, Romania and the Czech Republic. In the rest of the countries there is a negative balance for the farmers.  This is the reason that we need to propose action, and this is the substance of our communication adopted today.  What we propose in this communication, the Commission points out that the Member States may prioritise the continued and uninterrupted access to natural gas for fertiliser producers in their national emergency plan in the event of gas rationing in line with the Commission communication ‘Save Gas for a Safe Winter’. The fertiliser industry can be included in the emergency plan as a sensitive sector. State aid, this is what we mentioned in our communication. We have opened a temporary crisis framework for state aid, which enables a specific support for farmers and fertiliser producers. We increased the possible amount so that now there is EUR 150 million for the companies, fertiliser producers, and EUR 250 000 for one individual farm.  I can say that this, that this state aid used from March, when we opened this this possibility, the total amount of the state aid has been more than EUR 450 billion, the majority of which – almost 90% – by two countries: Germany and France. But this state aid for agriculture including the fertiliser sector is less than 1 % of this amount. We identified only 18 programmes with a total amount of EUR 3.5 billion, which is less than 1 % of the total amount. State aid is open also for the fertiliser industry and also for farmers.  Funds generated by measures such as the cap on market revenues, certain electricity generators and the solidarity contribution provided for under Union legislation can also be used – subject to the applicable conditions for purposes of national support schemes. This is the next opportunity. The crisis reserve. We are open also to this, and will discuss with the Member States to use the crisis reserve, which is EUR 450 million with possible co-financing by Member States to use also for the farmers affected by this increase of fertiliser prices.  I’d like to add that maybe this very important and concrete proposal, public authorities could, for instance, purchase fertilisers and offer them at lower prices to farmers. It will be treated not as a state aid and, with that, the price will be the same as when the public institution bought the fertilisers and offered this at the same price to the farmers – at a lower price than normally in the market.  The Commission will examine and discuss with Member States how to best use the CAP strategy plans to address the fertiliser situation. Sustainable fertilisation measures should be implemented in an accelerated manner.  The Commission encourages Member States to ensure that revisions of their plans are sufficiently programmed, as of now, to help farmers to use fertilisers more efficiently and sustainably.  Precision farming. This is an example. Unfortunately, only six Member States propose precision farming as an eco-scheme, but we recommend to use precision farming, which is a very important tool to use fertilisers in a more rational way. We are open to the amendment of the strategic plans and to use more precision farming to strengthen this support for this very good agricultural practice. It’s better for the investment to the precision farming because in 24 strategic plans this possibility was included.  The Commission will take steps to improve market transparency in the European Union fertilisers market by way of the new Market Observatory to be established in 2023 and the organisation of regular stakeholder consultation in the framework of the expert group of the European Food Security and Crisis Mechanism.  Also important is better access to organic fertilisers and nutrients from recycled waste streams, especially in regions with a low usage of organic fertilisers, as is support for the conversion of the European nitrogen fertiliser industry to one based using renewable and fossil free hydrogen, and to assure that there is a stable and workable regulatory environment governing the production of renewable and low carbon hydrogen, thereby ensuring that the market for renewable and low—carbon hydrogen—based fertilisers can rapidly develop.  Distinguished Members, they are the main proposals, which we present in the communication. I think it will be helpful to improve the situation because we fully understand that it’s the cost of the fertilisers now which is creating risk for food security in the future. This is our proposal. Once again, thank you all for including this important point on today’s agenda.