Poland has no current plans to implement a new support mechanism for the country’s farmers given the recent declines in fertilizer prices and the hope that the recent falls will become a trend, according to Poland’s PAP Biznes, citing Poland’s Minister of Agriculture and Rural Development Henryk Kowalczyk responding to an MP inquiry.
According to the report, while the minister noted that despite fertilizer prices still staying at “very high” levels, price declines recorded in October and November “could mark the beginning of [an increasing] trend reversal … especially that gas prices on the European market are in a visible declining trend.”
Kowalczyk also pointed to “a slowly improving situation regarding fertilizer imports,” as indicated not only by increased imports of nitrogen fertilizers, but also multi-nutrient products.
Last March, Poland introduced a Pln3.9 billion (or approximately $913 billion at that time) program of subsidies to farmers due to rising fertilizer prices (GM March 25, 2022).
Poland’s biggest fertilizer producer, Grupa Azoty SA, lowered its prices of its fertilizer products effective from Feb. 1 (see Ammonia Markets ).The producer said the decision followed a stabilization of natural gas prices on the European market seen in January, and the price reductions were being implemented “despite strong year-over-year increases in the prices of other fertilizer production inputs, including electricity, coal, phosphate rock, and potassium chloride.”
Azoty highlighted that it was “another significant price revision” by the group in response to changing market conditions, following a similar one in October last year (GM Oct. 21, 2022).
The Polish group, though, is unhappy with what it described as “cheaper fertilizer products from around the world” being offered on the free market in the European Union (EU), “including fertilizers bought from Russia and Belarus, despite the war in Ukraine and sanctions, as well as the Middle East.”
Azoty said it does not comment on the quality of these “competitively priced” products from abroad or their efficiency in agricultural production, which, it said, are often impossible to verify before purchase.
The group also reminded that the costs of energy, raw materials, labor, and environmental fees in the aforementioned fertilizer producing countries are “significantly lower” compared with the EU.
Poland’s other fertilizer producer, Anwil SA, a unit of Poland’s biggest oil refiner, PKN Orlen SA, in a Jan. 28 statement highlighted that for its production it uses natural gas from outside of Russia, “the price of which is higher than that of raw material from the East.”
Anwil also reminded that in December last year, the European Commission decided to abolish import duties on ammonia and urea, which, it said “resulted in the inflow of these products from outside the EU and the deteriorating situation of European producers” (GM Dec. 23, 2022).
The company said it was considering “various options and scenarios for further action in response to the current macroeconomic conditions in order to optimize prices.”
In reference to certain publications, Anwil pointed out it has “only a 22% share in the Polish fertilizer market.”