EUROPE FERTILIZER MARKET
- Industry and agriculture (together with forestry and other land use) represent 18% and 24% of global GHG emissions respectively.
- The International Fertilizer Association estimates that the fertilizer industry represents 2.5% of the global GHG emissions, including 1.5% related to fertilizer use.
- The production of nitrogen fertilizers is characterized by its high carbon intensity due to use of fossil fuels, mainly natural gas, used as fuel and feedstock.
- On an average of three seasons, fertilizers containing an average of 11.2 million tons of nitrogen, 2.7 million tons of phosphate, and 3.1 million tons of potash were applied to 133.7 million hectares of farmland in the European Union.
- Europe has estimated annual nitrogen, phosphate and potash fertilizer consumption to reach 10.6, 2.7 and 3.1 million tons respectively by the 2029/2030 season, applied to 132.4 million hectares of farmland.
- Imported fertilizers with a higher carbon footprint have increasingly substituted domestic EU products, resulting in an import penetration increasing from 20% to 30% of EU consumption over the last decade and a leading/resulting to a net increase of GHG emissions globally.
- The European Commission’s “The European Green Deal” represents the fertilizer industry, which is expected to play a vital role in delivering the EU’s ambition to lead sustainable agricultural production as well as contribute the transition towards a low-carbon economy.
With the development of agricultural production and an increase in the demand for food crops, farmers are on the lookout for methods to improve efficiency in their fields. With the further development of commercial fertilizers, nutrient gap has been somewhat closed.
The application of fertilizers increases the production of biomass in the plant and thus, yields. Therefore, it contributes to addressing the major challenge of feeding a growing world population.
The United Nations predicts that the population will increase by 2.3 billion people through 2050, and the world will have to produce 70 percent more food to meet everyone’s needs.
EUROPE FERTILIZER MARKET DYNAMICS
|1||October 2021||Grupa Azoty and Microsoft||Grupa Azoty and Microsoft signed an agreement to use the cloud technology in precision agriculture, fostering technological initiatives that change the manufacturing sector, and expanding the competencies of the Group’s employees.|
|2||September 2021||Yara International ASA||Yara Suomi Oy acquired Ecolan Oy marking Yara’s first acquisition in the organic fertilizer segment and reflects its commitment to play a bigger role in organic farming and in contributing to the circular economy.|
|3||June 2019||OCI N.V.||The Abu Dhabi National Oil Company (ADNOC) and OCI N.V. strategically partnered to combine ADNOC’s fertilizer business into OCI’s Middle East and North Africa (MENA) nitrogen fertilizer platform to form a new joint venture.|
|4||November 2018||EuroChem Group AG and Aphea.Bio||EuroChem Group AG and Aphea.Bio signed a research and development agreement to collaborate on the development of next-generation fertilizer technologies designed to significantly boost the take-up of key nutrients by plants.|
European fertilizer producers operate in a global market as fertilizers are traded in large amounts between continents. Currently, the fertilizer industry’s competitiveness is already being affected by the EU Emissions Trading System (ETS). Further decarbonization will increasingly expose the industry to the risk of carbon leakage.
Current measures under EU ETS are not enough to limit the European fertilizers sector’s genuine exposure. Since 2014, the sector has had no surplus and is a net buyer of emission allowances.
Investments in ammonia/fertilizer capacities are happening mostly outside the EU. The industry has made huge improvements in the energy efficiency by its production.
Companies are at a point where any future investment in current technology will only result in marginal efficiency improvements.
The Green Deal has a profound impact on key areas of the economy, requiring all sectors to play their part in decarbonization efforts.
For the fertilizers industry, the Green Deal brings many challenges but also opportunities if supported by the right policy solutions.
From summer 2022 onwards, fertilizer producers, traders and farmers will be subjected to confront the Fertilizing Products Regulation (FPR), which will change the way fertilizers are receiving the CE mark and the labeling requirements provided on the products.
NEW PRODUCT LAUNCH
To hasten the decarbonization of the food value chain, FertigHy, a fresh face in the low-carbon fertiliser industry, was launched.
With regard to the recent issues facing the EU and the security of the world’s food supply as a result of supply chain disruption and global natural gas supply uncertainty, FertigHy intends to provide farmers in Europe with affordable, low-carbon fertilisers.
The first facility that FertigHy will construct, own, and run will be in Spain, and it will be replicated in other European nations as part of its aim to create and run multiple large-scale low-carbon fertiliser operations.
Construction is about to begin on the facility, which will generate more than a million metric tonnes of low-carbon nitrogen-based fertilisers annually from green hydrogen and power that is entirely derived from renewable sources.
Communication on Ensured Fertiliser Availability and Affordability The European Commission recognises the fertiliser industry as being of utmost importance and is in favour of the switch to low-carbon fertilisers.
The fertilisers industry, in this case, is one example of how European industrial actors have chosen to invest in Europe in order to continuously decarbonize the economy.
Since FertigHy directly addresses the issues the EU is facing and seeks to become a European leader in the low-carbon fertiliser business, the early response of the European Commission to the US IRA has been significant in the decision to establish operations in Europe.
The goal of FertigHy is to cut emissions by up to two million tonnes of CO2 per plant and per year by expanding its activities throughout Europe.
‘Fossil-free’ fertilisers have been launched by Yara and Lantmaennen.
In comparison to utilising ammonia made from natural gas, Yara, a leading manufacturer of nitrogen fertilisers, said that using ammonia produced using renewable energy sources in Europe will lower the carbon footprint of the finished products by 80–90%.
It suggested that using green fertilisers might lower the climatic effect of wheat farming by 20%.
In order to create fertiliser, which releases nitrogen into the soil, a crucial nutrient for growing plants, ammonia is a crucial chemical building element.
Yara, situated in Oslo, has green ammonia projects in Australia and the Netherlands as well as plans to completely reduce CO2 emissions from its ammonia factory in Porsgrunn, southern Norway.
It is currently building a 24 megawatt (MW) pilot electrolyser plant at Porsgrunn with a capacity of 20,500 tonnes of ammonia per year, which will serve as the foundation for 60,000–80,000 tonnes of fossil-free mineral fertiliser.
This is big enough for us to start out on a commercial basis, build the market, and generate demand for the good.
There are some carbon emissions produced by the two remaining minerals in mineral fertilisers, potassium and phosphorus, at the moment, but it is anticipated that these will soon disappear as well.
It seems unlikely that farmers will be able to decarbonize the food value chain on their own; incentives will be required.
EUROPE FERTILIZER MARKET SEGMENTATION
By Product Type
- Mineral Fertilizers
- Organic Fertilizers
- Nitrogen Fertilizers
- Phosphorus Fertilizers
- Potassium Fertilizers
- NPK Fertilizers
- Grains & Cereals
- Oil Seeds
- Fruits & Vegetables
EUROPE FERTILIZER MARKET SIZE AND FORECAST
The Europe Fertilizer market is estimated at $XX Billion in 2022, growing at XX% CAGR till 2030.
|1||Q2-2021||The Grupa Azoty Group||The Grupa Azoty Group posted a net profit of PLN 168m ($ 42 M), an increase of PLN 111m ($ 27.8M) on the same quarter of 2020. In the second quarter of 2021, the Group’s consolidated revenue was PLN 3,173m ($ 795.1 M), up PLN 904m ($ 226.5M) year on year.|
|2||H1-2021||EuroChem||EuroChem recorded total sales of USD 4,366 M, up 45% year-on-year with cost of sales for EuroChem products flat and sales volumes of 13.4 million metric tonnes (MMT), generating company-record EBITDA for the six-month period of US$1.6 billion, in line with the Group’s ambitious growth plans.|
|3||Q2-2021||OCI N.V.||OCI N.V.’s revenues increased 67% to $1.5 billion and adjusted EBITDA increased 144% to a record $535 million in Q2 2021 as compared to Q2 2020.|
|4||Q2-2021||ICL Specialty Fertilizers||ICL Speciality Fertilizers’ consolidated sales were up 34% year-over-year reaching $1,617 million. Operating income of $243 million was up versus an operating loss of $169 million while Net income of $140 million was up versus a net loss of $168 million.|
Global presence, knowledge, and crop solutions make manufacturers well-positioned to expand their collaboration with the food industry.
Consumers are increasingly willing to pay for quality and sustainability, which helps to achieve better crop nutrition, application knowledge, and tools.
Resource scarcity, growing sustainability awareness and increased consumer pressure is creating a push towards a circular economy, including the Agri and food value chain.
Recycling and reuse of materials coupled with reduced waste and pollution are core ideas that are in trend.
Digital agriculture is developing rapidly, with several multinationals and start-ups making a large sum of investments into digital platforms.
Securing competitiveness in delivering knowledge and solutions hinges on their ability to achieve scale, generate value, and protect knowledge advantage.
Companies dedicated partnerships to increase yield and farmer income and to achieve a carbon-positive future. Partnering with many companies and organizations including larger food, technology, and energy producers.
To further support circular economy progress, market players have also joined the European Sustainable Phosphorous Platform (ESPP), The Platform for Accelerating the Circular Economy (PACE), the European Biogas Association (EBA) and the German Association for Water, Wastewater, and Waste (DWA).
The fertilizer industry has developed and prioritized the notion of product and nutrient stewardship: setting standards for the environmental footprint of individual products and optimizing their use to minimize impact.
- Yara International ASA
- OCI N.V
- PETROKEMIJA dd FERTILIZER FACTORY
- Nitrogénművek Zrt
- ICL Specialty Fertilizers
- Grupa Azoty Group
- BASF SE
- The Mosaic Company
- Nutrien Limited
- CF Industries