European energy crisis: after the steel industry, the production of fertilizers skips
Poland's Grupa Azoty, a large fertilizer producer, has stopped producing some key fertilizers, including nitrogen products and caprolactam, due to soaring energy costs, becoming the latest victim of the gas crisis in Europe.
Bloomberg reported that the company would also cut ammonia production because energy costs undermined the profitability of the business.
Natural gas is a key raw material for the production of synthetic fertilizers and the surge in prices has had a major impact on the sector, with the closure of several fertilizer producers in Europe.
Fertilizer use is also decreasing due to prices, with serious implications for global food security. According to the International Fertilizer Association, fertilizer use could drop by as much as 7 percent next season, which would represent the biggest drop since 2008, Bloomberg reported earlier this month.
" If European farmers import more produce from other exporters, for the more fragile agricultural markets of sub-Saharan Africa, South Asia and parts of Latin America, the global market will shrink ," a senior official said. IFA.
Chris Lawson, head of fertilizers at the CRU intelligence group, told Bloomberg: "I don't see how anyone can continue producing in Europe, other than those who covered the energy costs." "We expect ammonia prices to continue to rise."
Compounding the problem further is the fact that Europe imports many of its fertilizers from Russia. Due to the stalemate between Brussels and Moscow following the war in Ukraine, the former is looking for alternatives, including manure.
Meanwhile, fertilizer imports from other places are on the rise, reducing the access of poorer nations to vital agricultural products.
The fertilizer industry is not alone in suffering from excessive gas prices. According to an analysis by Reuters, nearly 50% of aluminum and zinc smelters in Europe have closed, with the latest victim being Slovalco, owned by Norsk Hydro, Slovakia.
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The article European energy crisis: after the steel industry, the production of fertilizers drops comes from ScenariEconomici.it .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/crisi-energetica-europea-dopo-la-siderurgia-salta-la-produzione-di-fertilizzanti/ on Wed, 24 Aug 2022 07:00:33 +0000.