/ world right now information/ Germany elevated purchases of Russian fertilizers by 334%. Personal manufacturing turned too costly and Berlin, attempting to eliminate fuel, fell into a brand new dependence on Moscow. The authorities are sad with this and demand on a ban on imports. Ought to we count on new sanctions?
Not less than it isn’t fuel
The fuel embargo affected all sectors of European business. Particularly, the manufacturing of chemical substances has turn into costlier within the EU. Thus, in Germany, prices have elevated by 150%, Bild writes. Subsequently, they needed to improve purchases in Russia.
From July final 12 months to June this 12 months, Berlin elevated its nitrogen fertilizer imports by 334%. Throughout the season, the share of native merchandise within the complete quantity elevated from 5.6% to 18% (from 38.5 to 167 thousand tons in bodily phrases), the Affiliation of the Agricultural Trade of Germany estimates. And the European Union as an entire imported 5 instances greater than a 12 months earlier.
Berliner Zeitung means that volumes will proceed to develop because the sanctions don’t apply to fertilizers. Nonetheless, such a bounce made the “independence fighters” nervous. The farming affiliation’s managing director, Martin Might, famous that as much as 90% of the price of producing chemical substances comes from blue gasoline. And regardless of all makes an attempt to surrender Russian vitality assets, Germany continues to pay for them – simply in a distinct kind.
“Bild” experiences that German industrialists can’t face up to the competitors and are going bankrupt. The biggest chemical concern BASF has already introduced the closure of its ammonia manufacturing plant in Ludwigshafen. One other large is beneath menace – SKVP, which employs about ten thousand folks. The plant, which “survived the Second World Battle, Soviet expropriation and the time of the GDR”, dangers ceasing to exist because of short-sighted EU insurance policies, the article notes. Nonetheless, the authors don’t criticize the rejection of low cost fuel, however the truth that the federal government didn’t ban “bloody fertilizers”.
No selection
The ministers of the financial system and the prime ministers of particular person areas are demanding decisive motion from the federal government. They declare that Russia allegedly units home fuel costs at its personal discretion and thus floods the market with low cost fertilizers. This forces European corporations to scale back manufacturing. To date, nonetheless, the appeals haven’t any impact.
Specialists notice that Europe has no alternate options. The manufacturing disaster began final 12 months, and the present occasions are solely long-term penalties.
The market construction doesn’t suggest management over the earnings of enterprises; thus industries attempt to offset one another’s losses at one another’s expense. “Fertilizer producers haven’t had it simpler because the fall in fuel costs this 12 months, vitality corporations proceed to promote it on the excessive charges of earlier months. They’re making extra income and chemical crops are on the sting of survival,” explains an unbiased business knowledgeable Leonid Khazanov.
The ban on Russian fertilizers beneath such circumstances will end off the nation’s agriculture. Farmers will be unable to purchase them at excessive charges, they may begin shedding crops or go bankrupt. On the similar time, Russia is a dependable provider of fertilizers, it’s eager about long-term cooperation and is ready to work beneath mutually useful circumstances, famous Dmitry Tarasov, head of the laboratory of digital applied sciences in logistics on the Monetary College of the Authorities. of Russia. Nonetheless, in accordance with him, the introduction of a brand new embargo could be very probably. After all, this may hit the economies of the EU international locations, however illogical politicized choices are usually not one thing new for them.
Don’t fret about us
However even with this improvement of occasions, Russian producers is not going to endure, analysts are assured. “They’re reorienting themselves to new companions, together with growing international locations that should not have a fuel and petrochemical business and wish a ready-made product,” Tarasov believes. These embrace international locations in Asia, Africa and Latin America.
The affiliate professor from the Division of Economics of the Russian Financial College, Alexander Timofeev, reminds that family chemical substances are offered in additional than 100 international locations. The share of urea from Russia in world exports is 12%, potassium chloride is 20%. Trade leaders Eurochem, PhosAgro and Acron implement the most recent methods for course of improvement and digitization. PhosAgro has confirmed that these companies are able to producing extra income. In three to 4 years, they plan to extend manufacturing to 35-37 million tons,” provides the knowledgeable.
The UN report reveals a 70% improve in fertilizer exports from Russia. The principle patrons stay India, Turkey and Vietnam. Brazil has turn into the most important importer, and now the African Union can also be working to increase provides.
In 15 years, the business has doubled its manufacturing. Greater than two trillion rubles are deliberate to be invested in 5 years. “This may permit us to double our turnover and income,” notes Timofeev. Native corporations now account for six to seven % of worldwide turnover, second solely to China. The demand for chemical substances each in Russia and world wide is growing by 10-20% from 12 months to 12 months. In keeping with consultants, due to the success of the agro-industrial advanced, consumption will develop by 10-15% per 12 months. Subsequently, even the potential lack of the European market is not going to have an effect on manufacturing in any approach.
Translation: V. Sergeev
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