EU tackles rising fertilizer costs under CBAM through targeted tariff relief

Tariff suspension details

The Commission will temporarily suspend remaining Most-Favoured-Nation (MFN) tariffs on ammonia, urea, and certain other fertilizers. Import tariffs from most-favoured nations stand at 6.5%, excluding higher staged tariffs on Russia and Belarus. These measures aim to pass benefits directly to farmers, with safeguards in place, and could enter force quickly to match CBAM costs.

Ministerial calls for relief

France’s Agriculture Minister Annie Genevard stated on 7 January that Trade Commissioner Maros Sefcovic agreed to a retroactive CBAM suspension for fertilizers from 1 January 2026. Italy’s Agriculture Minister Francesco Lollobrigida urged a “suspensive clause” on CBAM and immediate removal of the 6.5% duty on non-EU imports. France noted CBAM would raise farmer costs by 25% amid current crop prices, while Italy cited serious market circumstances.

US ammonia faces high charges

The Commission fixed ammonia’s default emissions intensity at 3.444 t CO₂/t for the US—well above typical natural gas-based levels of 2 t CO₂/t NH₃—yielding CBAM charges around $175/t plus 5.5% duty. ‘There is unlikely to be any flow of US ammonia to the EU using the default method; US suppliers will have to report actual, verified emissions to avoid the prohibitive charge,’ said Charlie Stephen, Head of Nitrogen at CRU. Suppliers must report verified plant-specific data to avoid such costs, unlike lower defaults for Algeria (2.101), Russia (2.283), and Trinidad (2.444)—with only a 1% markup versus 20-30% for other commodities; Trinidadian, Algerian, and Egyptian ammonia enters duty-free, while Saudi and Russian face 5.5% duties.