EU tax poses fertiliser increase risk for farmers – Lynch

Irish farmers cannot shoulder another major increase in input costs without serious consequences for food production and rural livelihoods, a Fine Gael Senator has warned.

Senator Eileen Lynch has raised concerns over the impact the EU’s Carbon Border Adjustment Mechanism (CBAM) will have on fertiliser prices and, in turn, on Irish agriculture.

“The conversation around CBAM has largely focused on climate policy and industrial competitiveness, but little attention has been paid to the practical impact this will have on farmers here in Ireland,” she outlined.

“Fine Gael Minister for Agriculture, Martin Heydon has already acknowledged the significant challenge to the agri sector caused by rising costs and he has said that CBAM risks the addition of a further layer of fertiliser cost inflation. This is why Ireland supports the provision of a mechanism to temporarily suspend the application of CBAM to fertiliser, and this must be done in the most expeditious manner possible.

“Farmers are already dealing with rising costs, uncertainty in global markets and increasing pressure to remain competitive. Adding further costs to fertiliser at a time when margins are already under strain risks placing many family farms in an impossible position.”

Around 30% of nitrogen fertilisers used across the EU are imported, and projections indicate that fertiliser prices could rise significantly. Farming organisations across Europe have warned that the cumulative cost to farmers over the coming years could be enormous, placing further pressure on food production and competitiveness.

Senator Lynch said the issue is particularly important for Ireland, given the central role agriculture plays in the Irish economy and in sustaining rural communities.

“Irish farmers are among the most efficient and sustainable food producers in Europe. We cannot continue to introduce policies that increase production costs while farmers are forced to sell into highly competitive global markets where those same costs do not apply.”

She went on to say that the current instability in the Middle East and the ongoing volatility in energy and fertiliser markets have highlighted the vulnerability of the sector and the need for greater realism in EU policymaking.

“We all support sensible climate action, but it must be workable. Policies introduced in Brussels must recognise the reality facing farmers on the ground in Ireland. Food security, farm viability and the future of rural Ireland must remain at the centre of decision-making.”

Senator Lynch is calling on the European Commission to urgently reassess the inclusion of fertilisers under CBAM as part of the Commission Action Plan on Fertiliser and to ensure that any revenues generated are reinvested in supporting farmers and protecting food production across the EU.