NFU Scotland has met with the Competitions and Markets Authority (CMA) to highlight the rocketing profits from fertiliser companies at a time of record food prices and input costs for farmers.

In the face of staple food prices rising sharply on the shelves and the cost of running a farm going through the roof, multinational fertiliser companies posted profits of £5.45bn in 2022 a giant leap from the £909m of profit in 2021.

The Energy and Climate Intelligence Unit reported that the three biggest fertiliser suppliers in the UK – CF Industries, Yara, and Origin Enterprises - saw profits jump 500 percent in 2022, relative to 2020.

NFU Scotland president Martin Kennedy and director of policy Jonnie Hall held a meeting with several representatives of the Competitions and Marketing Authority (CMA) this week. Mr. Kennedy said: “These eye-watering profits were secured during a period when farmers faced unprecedented prices at the farmgate for fertiliser.

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“Recognising and accepting the largely consumer-facing role of the CMA, NFU Scotland used the meeting as an opportunity to discuss the impact that record fertiliser prices have had on food production and food security, particularly in combination with the surging costs for energy, labour, and animal feed endured by farmers and crofters in the past two years.

“Availability of affordable fertiliser is a key component of our ability to produce affordable food, a matter that was raised at the Prime Minister’s ‘Farm to Fork’ summit in May. The cumulative effect all these input cost increases will have had an impact on both supply and price of food on shop shelves, and the Union would welcome any further investigation by the CMA in that area.”

During 2022, there was an unprecedented spike in fertiliser prices, peaking in July of that year at an average price of £841 per tonne for UK-produced ammonium nitrate. In July 2021, the average price for UK produced ammonium nitrate was recorded at £326 per tonne and in 2020 the price was £206 per tonne.

Volatility in the market was made worse this summer following the decision from CF fertilisers UK to permanently close the ammonia plant at its Billingham complex on the east coast of England.

The closure means that popular products like Nitram 34.5% will be manufactured using imported ammonia from other countries. Global supply chains of fertiliser are still recovering from being ripped apart following Western sanctions on two of the world's biggest producers Russia and Belarus.

In 2021, British farmers used just over 3.5 million tonnes of fertiliser products. Of this, 1.4 million tonnes were ammonium nitrate, 213,000 tonnes was urea and 492,000 tonnes was UAN (urea ammonium nitrate).