Speaking from Brussels after a series of high-level meetings with the EU Commission, IFA Inputs Project Team Leader and Munster Regional Chairman James McCarthy said it is critical that the Commission takes action to address market concentration and the unbalanced power held by a small number of multinational input suppliers, particularly in the fertiliser industry.
Mr McCarthy said, “Fertiliser manufacturers have benefited enormously from the fall in gas and energy prices over the last two years and this has been reflected in their published accounts. The lack of price transparency, coupled with increasing vertical integration of this industry within the EU, allows manufacturers to control prices right down to farm gate level, thus stymying real competition”.
“Irish farmers spend over half a billion Euro annually and the disparity between energy and fertiliser prices is seriously affecting farmers’ incomes as fertiliser is the second biggest expenditure item for tillage and livestock farmers. The EU Commission must examine why lower fertiliser production costs have not been reflected in farm gate prices.”
James McCarthy said, “The various DGs of the Commission, including Competition and Trade, must take immediate action given the fertiliser industry’s ability to maintain or raise prices and increase profit margins despite the significant fall in energy prices. It is clear that the vertical integration of the industry is stymying competition and seriously impacting on producers’ incomes. Production and distribution must be separated to create real competition.
“In addition, custom duties on non-EU manufactured fertilisers must be suspended with immediate effect. Precedence has been set by the Commission regarding the reduction or elimination of customs duties for other products on the grounds of public interest. Their suspension will increase competition, thus benefiting farmers and the rural economy.”