Europe calls Russian fertilizers “new gas”

Svein Tore Holseter, head of the Norwegian company Yara (one of the world’s largest producers of nitrogen fertilizers), said that Europe is becoming dependent on Russian fertilizers, as it was with gas.

“The paradox is that the goal is to reduce Europe’s dependence on russia, and we may now, without realizing it ourselves, be empowering russia to exert pressure in the areas of food and fertilizers,” the Financial Times quoted Holseter as saying.

Fertilizer prices have risen sharply since the outbreak of war in Ukraine in February 2022 and the imposition of sanctions against Russia, which forced EU countries to limit supplies of Russian gas (gas is the main raw material for nitrogen fertilizers such as ammonia and urea). Since then, fertilizers have become cheaper as gas prices have fallen, but the European industry is still struggling: Russian imports take up a large share of the market, Holseter explained.

In his opinion, Russia can use its market position for political leverage.

“When you produce something that is so important for food production, it is a powerful tool,” the Yara CEO noted.

According to Eurostat, EU imports of nitrogen fertilizers increased by 34% between 2022 and 2023, with Russia accounting for about a third of total shipments. Imports of urea, one of the most common nitrogen fertilizers, increased by 53% – double the increase from 2020 to 2021. Of this volume, 40% came from russia. Shipments have slowed this season, but Russian urea still accounts for almost a third of all imports.

The publication also notes that Russian gas supplies to Europe declined in 2022, following the outbreak of war in Ukraine and retaliatory sanctions by Western states. In the spring of 2023, European Commission head Ursula von der Leyen said that the EU had overcome its dependence on Russian oil and gas. According to her estimates, gas imports to Europe have fallen by 80 percent in eight months.

Tags: Russia, EU, fertilizers, sanctions