Copa and Cogeca have called for the suspension of the Carbon Border Adjustment Mechanism to protect farmers during the current fertiliser crisis
European farmers’ opposition to the Carbon Border Adjustment Mechanism (CBAM) is back in the spotlight as a result of the fertiliser crisis prompted by the war in Iran. Farmers are yet to discover what this new mechanism will cost them and whether it is sustainable for the sector.
European farming associations Copa and Cogeca said their initial estimate should raise concerns. Over a seven-year period, it calculated the cost of CBAM for farmers at €39bn, equivalent to 10 per cent of the current CAP budget over the same period.
Copa Cogeca released a video laying out the reasons to oppose CBAM. “Originally, the mechanism was designed to support industries covered by the EU Emissions Trading System (ETS), which prices CO₂ emissions,” Copa Cogeca stated. “While this instrument drives decarbonisation, it also increases production costs within the EU and can reduce competitiveness compared to international producers. CBAM was therefore created to ensure that imported goods face a comparable carbon price at the EU border, preventing carbon leakage. In principle, such a mechanism is understandable. However, the inclusion of fertilisers fundamentally changes the equation for farmers.”
Imports account for around 30 per cent of the nitrogen fertiliser used in the EU, and the CBAM levy is set to have a direct impact. In 2026 alone, Copa Cogeca stated, prices are expected to increase by around 15 per cent on average.
“The European Commission’s approach foresees a steady and progressive increase of this tax up to 2034,” Copa Cogeca said. “As a result, the direct cost of CBAM is estimated by Copa and Cogeca and its members at around €820mn in 2026, rising to €3.4bn by 2034. Over the next seven years, this would amount to approximately €12bn.”
However, Copa Cogeca warns that this would be the price of the mechanism only in a theoretical economy. ”If one considers the price alignment that EU-based fertiliser producers could operate, Copa and Cogeca estimate that the overall cost for farmers could reach up to €39bn over seven years, roughly equivalent to 10 per cent of the current CAP budget,” it revealed.
While agricultural output prices remain set on global markets, the exposure of fertiliser costs to additional policy-driven charges creates a structural imbalance, Copa Cogeca warned, which it said was dangerous for both food security in the EU and the long-term sustainability of European agriculture.
“This is why the European farming community opposes CBAM in its current form, and why this issue should raise concern far beyond the agricultural sector,” the associations stated. “Copa and Cogeca therefore call, in the context of the fertiliser plan expected on 19 May, at a minimum for the suspension of the mechanism and long-term measures to offset CBAM-related costs for farmers. In addition, full clarity should be given on how the CBAM revenues will be redistributed within the EU.”
