Soaring Fertiliser Costs Add to Pressure on UK Food Prices

Seasonal workers from Romania pick strawberries at a farm in Faversham, south east England on June 29, 2018.Daniel Leal-Olivas/AFP/Getty Images

British Farmers are dealing with a perfect storm of historic high prices of fuel and fertiliser leading to fears of increased food prices and potential shortages.

Potato farmer and independent agronomist from Lincolnshire, Mike Neaverson told The Epoch Times by email that he was covered for fertiliser this season “but many are not.”

In the future though, like many farmers, he will have to contend with skyrocketing prices for the material which supplies the nutrients essential for plant growth in agriculture.

The farming sector was already grappling with rising gas prices, but the ongoing Russia/Ukraine conflict has significantly worsened the situation. On top of that, Russia, the world’s biggest exporter of fertiliser announced recently that it would suspend exports in a move that would remove a large chunk from the global supply.

Price Increase

The National Farmers’ Union of England and Wales (NFU), Britain’s largest farming union, told The Epoch Times by email that it has seen markets on high alert due to the sharp increase in energy prices which has led to a 200 percent increase in the price of fertiliser.

“Anecdotally, prices are up from £265 per tonne [($348)] to £650 per tonne [($853)],” a spokesperson said, though those prices are set to increase, even daily.

“This surge in fertiliser prices is adding to pressure on farmers already hit by rising labour, fuel, and feed costs. Higher fertiliser prices equals greater risks for farmers because it would mean more investment in the face of other potential threats to the growing season, such as poor weather or a drop in demand without a guaranteed price for crops,” said Neaverson.

“Even so, whatever we use now we will have to replace for next season at what is currently some incredible prices. So for the first time in my career, we are reducing nitrogen fertiliser rates to a level which we know will significantly reduce yield as the economically optimum rate is no longer similar to the yield optimum,” he said.

“Others who specialize in marketing grain will be better placed to answer this than me, but my thoughts are that if Ukraine and/or large areas of Russia do not get planted this spring, then we are one global weather event (e.g. something like a drought in South America, late frost in Canada, etc.) from severe volatility that *could* limit supply,” added Neaverson.

“This would obviously hurt the poorest in the world first, but even in Western countries, this could make the already struggling pig and poultry sectors unviable as they are reliant on global commodities for their animal feed. My thoughts are that it is unlikely, but not impossible, that it would result in widespread human famine, but it could well result in a major realignment of what western consumers expect in terms of range, quality, and especially price,” he added.

Completely Forgotten

Authorities have stepped in some cases. CF Fertilisers, one of the UK’s premier fertiliser manufacturers halted production at its factories in Ince and Teesside back in September, citing the high price of natural gas. The closures sparked fears for the UK’s supply of carbon dioxide, which is made as a by-product during the fertilization process. However, the site was given a last-minute reprieve by the government to keep the supply moving, reported The Northern Echo.

Furthermore, last month farming and environment minister George Eustice suggested greener alternatives to fertiliser such as Fabaceae. Though for farmers like Neaverson, he believes that DEFRA (The Department for Environment, Food and Rural Affairs, the government department responsible for environmental protection, food production) has long not done enough for British food production.

“Fundamentally my outlook on life is for a free market and I wouldn’t necessarily call for government intervention in fertiliser pricing for example. However over the past decade, DEFRA has completely forgotten about the need for homegrown food production and has instead off-shored lower standards of production abroad under the false assumption that trade will always be easy, and food will always be cheap. That needs to be discussed,” said Neaverson.

Catastrophic Damage

Dr. John Constable, Director of Energy at Net Zero Watch, criticized the government’s commitment to a net-zero emission strategy during such an energy crisis.

He argued that a push to renewable energy has made Europe and UK critically dependent on gas in their electricity systems, which has increased the fragility of the underlying conventional systems that are keeping everything going.

“What renewables, low energy resources, have caused is a fuel diversity crisis, so they produce the illusion of fuel diversity because you have wind and solar etc. And it’s because of that that gas is the superior fuel which is guaranteeing the entire system,” he said.

“That is relevant to the fertiliser issue as many are derived from methane, a natural gas. And consequently, there is a competition in them being introduced,” said Constable.

He said that the UK needs natural gas for its electricity systems, but consequently, because prices have risen very high, some uses are being pushed to the edge and fertiliser is one of them.

“At some point, Western economies are going to have to have to correct this error. The question is sooner to avoid real catastrophic damage to their overall economies,” he said.