The European Commission has stopped short of recommending a suspension of EU carbon taxes on imported fertilisers as a way to counter the soaring cost due to the Iran war.
The Irish Government and others had called on the commission to allow for a suspension of the Carbon Border Adjustment Mechanism (CBAM) in order to lower the cost of importing fertilisers.
Ammonia and urea - the key ingredients in the manufacture of fertilisers - are being held up in the Strait of Hormuz as a result of Iran's de facto blocking of the waterway.
Since one third of the world’s supplies of the two ingredients transit the strait, the price of fertiliser has soared.
Following a meeting of EU agriculture ministers in Brussels, Commissioner for Agriculture and Food Christophe Hansen said: "The [European] commission has, for the moment, no plans to exempt fertilizers from the CBAM.
"Suspending the application of the CBAM for fertilisers as well, risks, again, worsening our dependency on imports.
"Discussion around this only would increase the uncertainty [and] this increase of uncertainty is not going to help us."
An Irish Government source said: "There was consensus around the table that there was a serious potential around the price and future supply of fertilisers.
"We will continue to engage with the commission on this serious issue."
Comm Hansen said he was convening a meeting of fertiliser producers, national experts and farming organisations on 13 April to look at potential solutions to the crisis.
He said that due to the high energy and emissions costs of producing artificial fertilisers, there should be a move towards organic alternatives.
"This is really for the mid term and the long term, where we need to get results to be more independent," he told a news conference in Brussels.
"The aim of the CBAM is, of course, to ensure that those exporting into the EU meet the same standards we apply to ourselves via the [Emissions Trading System]."
He suggested, however, that some revenues from the cross-border carbon tax could be used to help farmers with "price stability".
Irish officials have insisted that both a suspension of CBAM for fertilisers and a shift towards bio-based alternatives are worthwhile, but cannot be regarded as a complete alternative to artificial fertilisers in the short term.
It is understood that Irish suppliers bought large stocks of imported fertiliser ahead of the 1 January deadline for the CBAM regime to take effect, meaning reserves were fuller than normal.
However, sources suggest that those reserves will be required to provide for 60% of the country’s spring growing needs by the end of April.
However, Mr Hansen told reporters that as a result of suppliers hedging before the CBAM took effect meant that the problem would not be acute in the short term.
