The European Commission proposes to abolish import duties on raw materials for the production of nitrogen fertilizers, with the exception of supplies from Russia and Belarus. The corresponding draft resolution was published in the „Official Journal” of the European Union.
The document provides for the zeroing of import duties on ammonia and urea, which currently stand at 5.5% and 6.5%, respectively, by the end of 2024. For products from Russia and Belarus, duties will remain at the same level.
The proposed measure will help diversify the supply of raw materials for the production of fertilizers and reduce dependence on Russia, the European Commission notes. In light of the current market emergency caused by a significant increase in commodity prices and sanctions against Russia – the second largest supplier of nitrogen fertilizers in the EU – the regulator calls for the removal of duties as soon as possible, before the start of the autumn sowing season.
The European Union covers a significant share of the demand for ammonia and urea for the production of nitrogen fertilizers through external supplies. In 2021, the EU imported 2.9 million tons of ammonia worth €1.3 billion and 4.7 million tons of urea worth €1.8 billion. More than 60% of these volumes were imported duty-free – from countries that have preferences for access to the EU market. Russia accounted for 29% of European ammonia imports last year. The share of Russia and Belarus in the supply of carbamide to the EU market was 24%.
Based on these data, the EC estimates the budget losses from the zeroing of duties at 11 million euros per year.
Earlier, European media reported that the EU is considering lifting part of the sanctions on seven Russian banks to ensure trade in food and fertilizers.