Farmers face tough 2023 as fertiliser prices stay high
Farmers may be forced to spend as much as £628 million extra on nitrogen and phosphate fertilisers made using gas during 2023
By George Smeetoninfo@eciu.net
Information on this page correct as of:
Farmers may be forced to spend as much as £628 million extra on nitrogen and phosphate fertilisers made using gas during 2023, finds analysis by the Energy and Climate Intelligence Unit (ECIU). 
Although day ahead gas prices have fallen slightly, they remain high and so do the prices of fertilisers which require a lot of energy to make or even use gas as an ingredient. Previous ECIU analysis  found that farmers paid an extra £760 million for fertiliser over the course of 2021 and 2022 due to high gas prices, suggesting that they could be paying an extra £1.1 billion for fertilisers from 2021-2024 due to these high prices.
The latest fertiliser price data shows that farmers are entering 2023 continuing to face extremely high prices for high-carbon fertilisers made using gas. Global fertiliser prices  peaked in March-May 2022 around the time of the Russian invasion of Ukraine, then fell back over the summer. But in late 2022/early 2023 they have shown little response so far to falling gas prices.
Commenting, Matt Williams, land use analyst at ECIU said: “Farmers are staring down the barrel of another tough year. The price of fertilisers made from gas remains at historic highs meaning Britain’s farmers could pay hundreds of millions of pounds extra this year compared to more normal prices.
“Government agencies are already warning of a repeat of last year’s summer drought . Helping farm businesses survive and protecting the UK’s food security will mean supporting farmers. Boosting access to low-carbon alternative fertilisers, and rewarding them for restoring trees and hedges that can absorb carbon and hold water will help reduce drought impacts."
Notes to editors:
Fertiliser prices: https://ahdb.org.uk/GB-fertiliser-prices
Fertiliser use quantities: British Survey of Fertiliser Practice 2021 https://www.gov.uk/government/statistics/british-survey-of-fertiliser-practice-2021#:~:text=The%20British%20Survey%20of%20Fertiliser,for%20agricultural%20crops%20and%20grassland
Average price 2020 (across AN UK, AN imported) £216
Average price of AN UK (July) and AN imported (November) £791
Nitrogen use 2020a 888,000 tonnes
Nitrogen use 2023e 929,00 tonnes
Nitrogen spend 2020 £191,808,000
Nitrogen spend 2023 £734,839,000
Difference between nitrogen spend in 2020 and 2023 £543,039,000
Average price 2020 (Diammonium phosphate, Triple Super Phosphate) £287
Average November 2023 price of phosphate fertilisers (Diammonium phosphate, Triple Super Phosphate) £819.5
Phosphate use 2020a 166,000 tonnes
Phosphate use whole 2022e 163,000 tonnes
Phosphate spend 2020 £47,642,000
Phosphate spend 2023 £133,578,000
Difference between phosphate spend in 2020 and 2023 £85,936,000
Total 2020 spend £239,450,000
Total 2023 spend £868,417,000
Difference between 2020 spend and 2023 spend £628,967,000
2. ECIU: Two more years of high gas prices could leave British farmers paying £1.1 billion extra for fertilisers: https://eciu.net/media/press-releases/2022/two-more-years-of-high-gas-prices-could-leave-british-farmers-paying-1-1-billion-extra-for-fertilisers
4. Water security in focus as England faces threat of another summer drought: https://www.ft.com/content/5c46d8c3-c0bc-4ae6-8b0d-b8721ff28ac6
For more information:
George Smeeton, Head of Communications, ECIU, Tel: 07894 571 153, email: email@example.com