Re: Elimination of Fertiliser Customs Tariffs and Anti-dumping Duties

Fertiliser is the third main expenditure item on EU farms accounting for €19.2bn in 20141. The EU fertiliser market is highly protected through the imposition of duties on non-EU imports. Analysis of Irish price data shows that fertiliser prices are out of line increasing at twice the rate2 of other inputs since 1995. Unlike feedingstuffs there is limited price transparency. The European industry refuses to offer co-operatives or farmers the opportunity to manage price risk through hedging mechanisms. Increased concentration of the industry over the last 4 decades allied with protection measures and greater vertical integration of the industry has stymied real competition allowing prices to increase at a disproportionate rate.

The Irish Farmers Association commissioned a report with the International Food and Policy Research Institute (IFPRI). The report launched in February, looks at the Effects of Import Duty Elimination on Competition in the EU Fertiliser Sector. The findings show that protection afforded to EU manufacturers through the application anti-dumping duties of €32.83/t to €47.07/t and customs tariffs of 6.5% is costing farmers close on €1bn per annum at a time when farm incomes are under extreme pressure. In addition the abolition of duties would deliver significant job creation in the wider EU rural economy of a minimum of 17,245 jobs and possibly of approximately 100,000 jobs in the best-case scenario.

Customs duties on fertilizers should be eliminated with immediate effect by means of a Council Regulation amending the Common Customs Tariff (Legal basis: Article 31 TFEU - Duties shall be fixed by the Council on a proposal by the Commission). There are precedents for this move:

  • Unwrought aluminium: COUNCIL REGULATION (EC) No 501/2007 of 7 May 2007
  • Jet fuel: COUNCIL REGULATION (EU) No 1325/2013 of 9 December 2013
  • Parts and component used for civil aircraft production: COUNCIL REGULATION (EC) No 1147/2002 of 25 June 2002

Anti-dumping duties on Russian-origin ammonium nitrate should be suspended with immediate effect by means of a Commission Decision:

  • Legal basis: Article 14 (4) of Antidumping Regulation
  • Factual basis: market conditions have changed to an extent that injury would be unlikely to resume as a result of the suspension
  • Commission’s commitment to look at suspending duties of June 2014: The Commission (Head of Unit, in charge) promised to consider the proposal in 12-18 months, having analyzed the market conditions which now manifestly support the need for the suspension.

The elimination of duties and tariffs will deliver a significant boost to farm incomes, job creation and rural regeneration. In addition it will allow for the sourcing of fertiliser with lower cadmium levels without imposing additional costs on farmers while safeguarding human health.

I am asking for your active support now for the elimination of duties and tariffs as a means of redressing the farm income crisis. The Commission is amenable to proposals that will regenerate the rural economy across 28 Member States in advance of the June Council of Agriculture Minister’s meeting.

Kind regards,

______

Chairman

Jer Bergin

1Eurostst

2 Irish Central Statistics Office