High enter prices for farmers and an insufficient provide of carbon dioxide within the meals manufacturing course of will proceed except the federal government addresses the issues within the fertiliser market, the Environment, Food and Rural Affairs (Efra) committee has warned.
Chairman Sir Robert Goodwill has written to Defra secretary George Eustice outlining Efra’s issues following the information that the UK’s solely fertiliser producer has determine not to reopen one among its two vegetation.
CF Fertilisers introduced earlier this month that it might be completely closing its manufacturing plant at Ince, Cheshire, stating it wanted to restructure its operations to guarantee a continued provide of fertiliser and carbon dioxide.
See additionally: Why a wheat grower is reducing inputs down to the naked bones
Its second plant in Billingham produces about 128,000t of ammonium nitrate (AN) every year, whereas Ince had produced 95,000t earlier than it stopped manufacturing final September.
But the corporate insisted Billingham “has the capability to produce sufficient AN to meet all forecasted home buyer demand”.
Food provide implications
Sir Robert stated: “UK farmers have already seen vital value rises due to the impression of fuel costs and the battle in Ukraine.
“The choice to not reopen the CF plant lowers the probability of elevated provide and in flip a decreasing within the value of fertilisers. This means farmers are probably to proceed to face excessive enter prices which can contribute to rising meals costs and lowered monetary returns for farmers, a lot of whom already function on very tight margins.
“There may even be an impression on the UK’s means to produce carbon dioxide, which performs a essential function within the meals provide chain. Uses embody: getting used within the packaging and transport of meals to prolong its shelf life; the promotion of plant development; and to stun animals forward of slaughter. Therefore, an insufficient provide of carbon dioxide would have animal welfare, meals manufacturing and meals safety implications.”
Efra has requested Mr Eustice to set out the assurances he has acquired in regards to the adequacy of fertiliser and carbon dioxide provide, and the work Defra has finished to confirm these assurances.
The committee has additionally requested Defra to present additional details about what options are being explored via the dedication within the authorities’s meals technique to develop plans to bolster resilience of essential inputs corresponding to carbon dioxide and fertiliser, in addition to a publication date for the precise lengthy-time period plan on carbon dioxide due this yr.
Mr Eustice has been requested to reply by Thursday 7 July.
CF Fertilisers plant closure timeline
In September 2021 excessive fuel costs pressured CF Fertilisers to quickly shut its two ammonium nitrate (AN) manufacturing vegetation.
Production solely resumed when the federal government supplied help within the type of a multi-million-pound taxpayer subsidy to underwrite the price of manufacturing on the Billingham web site for an preliminary three-week interval.
Following this, the Department for Business, Energy and Industrial Strategy facilitated an settlement to pay CF Fertilisers for carbon dioxide till January 2022, which enabled the corporate to proceed working whereas world fuel costs remained excessive.
Since then fertiliser merchants have been rising more and more pissed off in regards to the lack of expertise on UK AN provide, together with when it might subsequent be obtainable, how a lot can be on provide, and at what value.
Prices peaked at greater than £900/t within the spring and regardless of a major drop have remained excessive, inflicting many farmers to determine towards additional fertilise purchases and software.
In June, CF Fertilisers introduced plans to completely shut one among its manufacturing plans at Ince, Cheshire.
At the time, the NFU stated the federal government and business should construct transparency into the fertiliser market to enhance farmer confidence in choice-making and construct resilience within the nation’s meals safety.
NFU deputy president Tom Bradshaw stated an entire lack of transparency within the fertiliser market was leaving growers with out sufficient info to encourage confidence of their enter buying choices.
The union referred to as on suppliers to publish fertiliser costs instantly to assist farm companies plan for subsequent yr’s crop and requested the federal government and business to produce a variety of choices to allow the Ince plant to reopen.