31 August 2001

EUs urea tariff brings angry response

FARMERS leaders across Europe have reacted angrily to the EUs provisional decision to slap a tariff on cheap imported urea.

Brussels concluded that the urea, mainly from central and eastern European countries, was being dumped at low prices and undermined EU manufacturers. But farming unions say commissioners have ignored farmers interests.

COPA/COGECA, which represents EU farm unions and co-ops, believes the timing could not be worse, with incomes on the floor and prices having gone up 50% last year. "Another rise now would seriously jeopardise the competitiveness of our farmers," said a spokesman.

The NFU has also challenged the decision. President, Ben Gill, wrote to EU trade commissioner Pascal Lamy last week, saying the case was biased towards fertiliser manufacturers. The decision is likely to add k7-k18/t (£4-£11/t) to the cost of urea, he claimed. "We have every reason to believe that the cost will be passed on in full to farmers and there is little scope for farmers to then pass these on."

But this is denied by Fertiliser Manufacturers Association director general, David Heather. "The new tariffs put a floor in the urea market," he said.

"But actual prices are set by supply and demand and the world price of urea is already well above that floor.

"Dumping was a problem two or three years ago, when prices were low and people were selling below the cost of production just to get into the market. That is not the case now. These anti-dumping tariffs simply mean that, if world prices do fall back in a year or two, we will not face the same problems."

Despite the claims, the NFU intends to lobby in Westminster and Brussels to get the new rules reversed when the anti-dumping committee decides in January whether to extend the new duties for five years.

Mr Gill maintains that the problems of job losses and diminishing market share in the EU fertiliser industry stems from the commercial decision to reduce capacity, rather than from unfair competition from imports, as claimed by the manufacturers. &#42