Written answers

Thursday, 21 January 2016

Department of Agriculture, Food and the Marine

Fertiliser Industry

Photo of Helen McEnteeHelen McEntee (Meath East, Fine Gael)
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21. To ask the Minister for Agriculture, Food and the Marine his efforts at the European Council of Ministers and his engagements with the European Commission to ensure a concerted European Union approach to tackling fertiliser prices; his efforts to support crop-production enterprises which are encountering historically high fertiliser prices and difficult market prices for produce; and if he will make a statement on the matter. [2201/16]

Photo of Simon CoveneySimon Coveney (Cork South Central, Fine Gael)
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The Irish Fertiliser Industry does not currently manufacture nutrients in Ireland. The industry is almost entirely reliant on the importation of nutrients which are subsequently sold on as straights or blended into compound products. The predominant nutrient form used in the Irish context is Calcium Ammonium Nitrate (C.A.N) with over 80% of Nitrogen used in this form. Fertilisers are the second highest input cost on Irish farms after feedingstuffs. Fertiliser usage has seen a downward trend on Irish farms over the past 20 years and this is likely to be linked to enhanced efficiency of use, environmental controls and price increases.

Europe as a whole is also dependent on imports to meet the demand. Approximately 20% of supplies are imported into Europe. Fertiliser price, primarily nitrogen, is strongly linked to the price of natural gas, with the fuel input constituting over 75% of Nitrogen manufacturing cost. As a result, most fertilisers are produced in areas where local oil supplies are available at low cost. As a result the Middle-East, North Africa, Russia and the USA still maintain a competitive advantage over Europe in the manufacture of Nitrogen. While fuel prices have decreased considerably in recent times, it remains more economical to manufacture Nitrogen in regions outside of the European Union where natural gas is produced and pricing is more competitive. Phosphates and Potassium are also in limited supply within Europe. Rising global demand for fertiliser has also increased pressure on supplies across Europe. Currency exchange rates also impact and with the Euro trading weakly against the dollar this has contributed to the upward pressures on fertiliser prices.

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