The drop in gas prices does not affect the price of artificial fertilizers

Main conclusions:

• Current price levelsFertilizer prices are currently high, partly due to CBAM uncertainty and unknown emission factors that have been priced in.
• Availability: Stock that is already on hand, or has recently arrived, is available, allowing the basic requirement for January to be met.
• Outlook Q1 2026: Lower supply is expected from February through April, which, together with logistical challenges, could impact the market price.

The emission factors, which determine how many CO2 allowances must be purchased, are not yet known. Furthermore, it is currently unclear whether these figures will be determined country-specifically or whether a single, uniform standard will apply. As a result, importers do not yet know exactly how many CO2 allowances they must purchase in January for their imported fertilizer. This uncertainty is holding the market hostage and directly translates into higher fertilizer prices. Even with stable or declining gas prices, a decrease in fertilizer prices for January is currently unlikely.

Availability of no acute care for the time being
The existing stock, or recently arrived stock, is available, meaning the January demand can generally be met. However, less supply is expected for February through April, which could make logistics planning more challenging. A total shortage has never occurred, but the timing of deliveries could be problematic. Any supply problems are not due to a lack of production, but to uncertainty surrounding CBAM.

Outlook Q1 2026
The first quarter of 2026 is unpredictable. As long as the final CBAM emission factors remain unknown, importers will remain cautious about new supplies, while the new nitrogen and phosphate focus areas are creating uncertainty for farmers. Prices remain sensitive to news from Brussels, and logistical pressure may increase towards February and March. Only when clarity is achieved on both the supply and demand sides can the fertilizer market emerge from its current wait-and-see phase.

International dynamics
International developments also play a role. Due to US import tariffs on fertilizers from most countries, but not from Russia, Russian suppliers have significantly strengthened their position in the US market, capturing approximately 35% of US nitrogen fertilizer imports. Any easing or revision of these tariffs could restore competition, with alternative suppliers such as Algeria and Nigeria challenging Russia's position. These kinds of international shifts can also indirectly impact availability and pricing in Europe.

Uncertainty on the demand side
In addition to CBAM, the transition from NV areas to the new focus areas is also influencing market demand. Starting in 2026, the old NV areas will be replaced by smaller, more specific nitrogen focus areas, which in many cases will result in a 10% or 20% reduction in the nitrogen application standard. It is estimated that approximately 65 areas will fall under the new regulation, compared to 26 NV areas previously. The general nitrogen standard will increase slightly for northern and western sand. For central sand (Overijssel, Gelderland, and Utrecht), the standard will remain virtually unchanged, while for southern sand and loess soils, the standards will be lowered, particularly for leaching-sensitive crops. Simultaneously, phosphate focus areas will be designated, covering approximately the same number of locations. These measures will not become effective until 2027.