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NFUS Raises Concerns Over Fertiliser Market

28 June 2011

UK - NFU Scotland has written to Europe's competition authorities raising concerns over a lack of price transparency and competition in the fertiliser market.

Producers are bracing themselves for further fertiliser price hikes of around £25 per tonne this coming autumn, adding to escalating food production costs at farm level. With only one UK fertiliser manufacturer and a limited number of players at EU and World level, the Union believes there is a danger that the pricing of fertiliser both locally and globally no longer follows competitive market rules.

It has written to the Office of Fair Trading at the European Commission asking it to look into the issue.

Speaking at the 2011 Highland Show, taking place at Ingliston near Edinburgh, NFU Scotland Vice President John Picken said:

"The recent upswing in World, European and UK cereal markets has certainly raised expectations amongst Scottish cereal producers that, given fair harvest conditions, respectable prices may again be achieved this autumn. Those same speculative predictions also appear to have encouraged some within the fertiliser trade to rewrite their price book.

"Once again we face the prospect of increased bills for fertiliser landing on doormats before any crops have been physically sold from the farm. That is unhelpful and in the interests of long term relationships between farmers and suppliers, I urge that a common-sense rather than opportunistic approach to fertiliser prices be taken.

"Faced with fertiliser price hikes, we have taken the opportunity to ask the European Competition authorities to look at the fertiliser market and the market power that the small number of players in the fertiliser industry in Europe hold.

"Given the growing importance of food security and the need to maintain or grow farm output, we have reminded the authorities of the key role that fertiliser plays in the productivity of farm units. If we are to avoid a repeat of the food crisis seen in 2007 and 2008, then the authorities must reassure themselves that the pricing of fertiliser is transparent and follows normal competitive market rules.

"The near monopolisation of the fertiliser industry by a few big players has implications for future food production. We believe that it is timely for the Commission to investigate the workings of the fertilisers markets to ensure that they are operating effectively."

TheCropSite News Desk

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