Europe has replaced its dependence on Russian gas with that of Russian fertilizer

The chief executive of Yara International, Europe’s largest fertilizer maker, has warned that the bloc is rapidly going ‘asleep’ in excessive dependence on Russian fertilizers. This caution comes after Yara significantly reduced its production last year.

Furthermore, radicals in Brussels are pushing a green agenda that could undermine the stability of Europe’s fertilizer production long before it reaches its climate change goals.

“Fertilizer is the new gas“Chief Executive Officer Svein Tore Holsether told the Financial Times in an interview, adding: “It’s a paradox that the goal is to reduce Europe’s dependence on Russia, and then now we’re moving on to Russia, in sleepwalking way, the critical food and fertilizer power”.

If fertilizer is the new Russian gas, luckily it doesn’t come via pipeline! Otherwise we would see a Nord Strem second episode!

A significant problem for European farmers is the sourcing of cheap fertilizers domestically. The interruption of flows of low-cost natural gas from Russia to Germany and Europe in general has also interrupted Western production of these substances, the production process of which is highly energy-intensive.

The Yara company reduced its ammonia production capacity by 19% in 2023, or 890,000 tons, and its finished fertilizer production capacity by 15%? At the end of the year, around 58% of its European ammonia capacity was idle, and this was imported, mostly from Russia.

Holsether noted that Russian fertilizer imports are taking a more significant market share, thanks to low-cost Russian producers.

A possible attempt to get rid of Russian supplies would lead to a new inflationary shock, exactly as happened with gas, but we cannot exclude that the lack of consideration by the European authorities could lead to this choice. Instead we should fight to have low-cost energy sources to be able to continue the production of ammonia and fertilizers in the West.

But another path was chosen.