13 May 2019
COMMISSIONER HOGAN’S INTERVENTION ON QUESTIONABLE FERTILISER BUSINESS PRACTICES WELCOME – HEALYFertiliser
IFA President Joe Healy has welcomed the intervention by EU Commissioner Phil Hogan in the escalating fertiliser debacle that has seen the recent imposition of temporary anti-dumping duties on certain non-EU UAN fertiliser imports by DG Trade.
Mr Healy said, “Commissioner Hogan’s request of Competition Commissioner Vestager to take swift action to ensure the proper functioning of the EU’s internal fertiliser market, in light of questionable business practices with respect to competition rules, represents a key turning point in this case”.
“Commissioner Hogan’s assessment of the malfunctioning of the EU’s fertiliser market mirrors many of the conclusions raised in the IFA commissioned study into the sector, carried out by the Washington based International Food Policy Research Institute (IFPRI). Indeed, he rightly points to the need for price transparency and the operation of fair pricing mechanisms to create a properly functioning market.”
“The IFPRI report, published in 2016, found that EU farmers are paying among the highest prices in the world for mineral fertilisers. Anti-dumping duties and customs tariffs imposed by the EU Commission on certain non-EU fertiliser imports were costing farmers €1 billion per annum. It established that the increased concentration of EU industry since 1994 enabled fertiliser producers to significantly increase profit margins. Indeed, DG Trade, in its recent interim expiry review of ammonium nitrate anti-dumping duties concurred with the IFPRI findings regarding increased concentration of the industry.”
“More alarmingly the IFPRI report identified that EU fertiliser prices not in line with the predicted model outcome. It stated that “Based on the observed data, prices in Western European countries actually increased by 123%, while prices in Brazil decreased by 65% . . . . . further suggests that additional factors, such as price fixing and cartels, might be operating in highly concentrated markets such as Western Europe”.
“In light of these findings it is all the more worrying that DG Trade saw fit to extend temporary anti-dumping (AD) duties recently to certain UAN fertiliser imports. This is despite the fact that IFA, COPA and other EU farming groups highlighted that the additional duties will cost farmers an estimated €2.7bn over the term, thus disproportionately affecting farm incomes which are already at an all-time low across many sectors.”
Mr Healy said, “Commissioners Malmström and Vestager must pay heed to Hogan’s request as it is in the Union’s interest to ensure that we maintain the competitiveness of the EU’s farming sector and support family