Is Europe’s New Fertiliser Plan Too Dependent on Fossil Fuels?

Europe unveils fertiliser plan amid fossil fuel dependency concerns

The European Commission published its Fertiliser Action Plan on 20 May 2026. The plan aims to ease price volatility, secure supply chains and support lower-carbon production. However, environmental groups and policy analysts warn that the measures may not address the root cause of recent disruptions: Europe’s structural reliance on natural gas for fertiliser production.

This matters for UK businesses because fertiliser costs directly affect agricultural input prices, food manufacturing expenses and supply chain stability. Moreover, the UK faces similar dependencies. Understanding how the EU responds to this challenge offers insight into the policy direction other governments may follow.

The debate centres on whether the Commission’s approach goes far enough. Supporters say the plan builds resilience into nutrient supply chains. Critics argue it stabilises a fossil-dependent system without reducing the underlying vulnerability.

Why fertiliser markets remain tied to fossil gas

Synthetic nitrogen fertiliser production is energy-intensive. Natural gas serves both as a feedstock and an energy source. Consequently, fertiliser prices track gas market movements closely.

Greenpeace EU states that nitrogen fertilisers are highly fossil fuel dependent. The organisation notes that the EU imports around 90% of its gas and roughly 30% of its nitrogen fertilisers. During the 2022 energy crisis following Russia’s invasion of Ukraine, import dependence for nitrogen fertilisers rose to approximately 45%.

The Heinrich Böll Foundation makes a similar point. The think tank argues that Europe’s agriculture remains vulnerable because synthetic nitrogen fertiliser requires fossil gas as a feedstock. Therefore, when gas prices surge, fertiliser production becomes more expensive, supply tightens and farm input costs rise. These cost increases often feed through to retail food prices.

Fertilisers underpin large parts of modern industrial agriculture. As a result, gas price shocks translate quickly into agricultural disruption. This linkage creates commercial risk for farmers, food manufacturers and retailers who depend on stable input costs.

What the Commission has proposed

The European Commission presented its Fertiliser Action Plan in May 2026. According to Euronews, the Commission seeks to break the chain reaction linking gas prices, fertiliser shortages and rising grocery bills. The plan includes several measures: emergency financial support for farmers, promotion of domestic production, investment in bio-based and recycled nutrients, stockpiling arrangements, joint procurement and enhanced price monitoring.

Commissioner for Agriculture Christophe Hansen said Europe needs to produce more and depend less on others for agricultural nutrients. He confirmed that €200 million remains available in the EU’s agricultural crisis reserve. Furthermore, the Commission intends to at least double this amount to help affected farmers. Hansen added that the Commission aims to put a concrete financial instrument in place before summer 2026.

The plan also addresses geopolitical risks. Euronews reported that concerns over disruptions linked to the Middle East conflict and the Strait of Hormuz shaped the Commission’s approach. The Strait serves as a key passage for approximately 30% of the world’s fertilisers and 20% of natural gas supplies.

In addition, the Commission wants to encourage domestic production of lower-carbon alternatives. This includes bio-based fertilisers and recycled nutrients. The goal is to reduce exposure to imported gas and geopolitically sensitive supply chains.

Environmental groups say the plan avoids structural reform

Environmental organisations argue that the plan risks reinforcing the same dependency it aims to reduce. In a letter to the Commission, Greenpeace EU warned that the EU appears focused only on improving fertiliser availability and affordability. The organisation says the plan fails to tackle the built-in dependency on synthetic fertilisers.

Greenpeace EU argues that future shocks will continue to disrupt food systems unless the EU supports alternatives. These include low-input farming, agroecology, organic farming, legume production, reduced food waste and more circular nutrient management. The organisation believes that stabilising supply without reducing demand leaves the underlying vulnerability intact.

The European Climate Foundation has raised similar concerns. The organisation warns that Europe’s structural dependence on imported fossil fuels and fertiliser derivatives poses significant risks to economies, security and food system resilience. It argues that the Commission responded to the energy crisis by accelerating a structural shift away from imported fossil fuels. A comparable shift is needed in agriculture, the foundation says.

The Center for International Environmental Law (CIEL) has criticised the broader direction of EU farm policy. CIEL says the bloc’s newer agricultural vision prioritises competition, digitalisation and technical fixes rather than the sustainability agenda outlined in the Farm to Fork strategy. That strategy aimed to reduce fertiliser use by at least 20% by 2030 and cut pesticide use and risk by 50%.

Critics insist that resilience depends on moving away from a system that ties food production to gas markets. They argue that the Commission should not simply secure supply but also reduce demand through soil health, crop rotation, legumes, better manure management, dietary shifts and waste reduction.

Commercial implications for UK businesses

This debate has direct relevance for UK businesses in agriculture, food manufacturing and retail. Fertiliser costs represent a significant portion of farm input expenses. Therefore, volatility in gas markets creates budgeting uncertainty and margin pressure.

For farmers, price spikes can erode profitability quickly. Input costs rise faster than product prices, particularly in commodity markets where price setting is competitive. Consequently, farmers face difficult decisions about planting, crop selection and input use. Some may reduce fertiliser application, which can affect yields and quality.

Food manufacturers and processors also feel the impact. Higher fertiliser costs increase raw material prices for grains, vegetables and other crops. These cost increases move through supply chains, affecting production budgets and pricing strategies. Manufacturers must decide whether to absorb costs, pass them to retailers or renegotiate contracts.

Retailers face similar pressures. Rising food prices can reduce consumer demand, particularly for discretionary purchases. However, staple foods remain essential, so retailers often absorb some cost increases to maintain competitiveness. This squeezes margins and requires careful inventory and pricing management.

Supply chain stability is another concern. Disruptions in fertiliser supply can delay planting, reduce crop availability and create shortages. For businesses that depend on consistent volumes and predictable pricing, this creates operational risk. Contracts may be harder to fulfil, and alternative sourcing can be expensive.

The UK imports significant quantities of both gas and fertilisers. As a result, the country faces similar vulnerabilities to those affecting the EU. Policy responses in Brussels may influence thinking in Westminster. Understanding the EU’s approach helps UK businesses anticipate regulatory direction and commercial trends.

Moreover, businesses that supply UK farmers or source agricultural products may need to consider alternative nutrient strategies. Bio-based fertilisers, recycled nutrients and precision agriculture techniques could reduce dependence on synthetic nitrogen. However, these alternatives require investment, knowledge and infrastructure. Early adoption may offer competitive advantage as policy support grows.

Five key facts about Europe’s fertiliser dependency

• The EU imports around 90% of its natural gas, according to Greenpeace EU.
• Approximately 30% of the EU’s nitrogen fertilisers are imported, rising to about 45% during the 2022 gas crisis.
• The EU’s Farm to Fork strategy aims to reduce fertiliser use by at least 20% by 2030.
• The European Commission has €200 million available in the agricultural crisis reserve and intends to at least double that amount.
• The Strait of Hormuz serves as a key passage for roughly 30% of the world’s fertilisers and 20% of natural gas supplies.

Whether the plan can deliver structural change

The central challenge is that reducing fertiliser price volatility is not the same as reducing fossil dependence. If the EU simply replaces imported fossil-based fertiliser with slightly less carbon-intensive versions, it may soften emissions but leave structural vulnerability intact.

Three potential outcomes are possible. First, the plan could provide short-term resilience. Emergency financial support may cushion farmers from price spikes before the next planting cycle. This offers immediate relief but does not change the underlying system.

Second, the plan could encourage industrial diversification. Expanding domestic production of low-carbon, bio-based and recycled fertilisers may reduce exposure to imported gas and geopolitically sensitive supply chains. This represents progress but still depends on energy-intensive production methods.

Third, the plan could enable structural transition if paired with stronger incentives for nutrient efficiency, organic methods and agroecological practices. This would reduce demand for fossil-based fertilisers over time. However, this outcome requires policy commitments beyond the current plan.

The Commission’s approach will be tested in the coming months. If the financial instrument materialises before summer 2026 as promised, farmers will gain some protection against near-term price shocks. However, longer-term resilience depends on whether the plan evolves to include demand-side measures.

For UK businesses, the key question is whether this marks a turning point or a holding pattern. If the EU moves decisively toward lower-input agriculture, UK suppliers and producers may need to adapt quickly. If the plan mainly stabilises supply without reducing dependence, the same vulnerabilities will persist.

What UK businesses should consider

Businesses exposed to agricultural input costs should monitor how the EU implements its Fertiliser Action Plan. The measures announced so far focus on supply security and financial support. However, the debate about structural reform will continue. Policy developments in Brussels often influence UK regulatory thinking, particularly in areas where supply chains and trade are interconnected.

Farmers and agricultural suppliers may want to explore alternative nutrient sources. Bio-based fertilisers, recycled nutrients and precision application techniques can reduce reliance on synthetic nitrogen. However, these approaches require different skills, equipment and supply relationships. Early engagement with sustainable procurement support can help identify viable options.

Food manufacturers and processors should assess their exposure to fertiliser price volatility. Supply chain diversification, contract structures and hedging strategies can mitigate risk. Additionally, businesses that demonstrate progress on input efficiency and emissions reduction may find advantages in tenders and procurement processes where sustainability criteria carry weight.

Businesses preparing for carbon reporting requirements should understand how fertiliser use contributes to Scope 3 emissions. Agriculture represents a significant emissions source for many food supply chains. Accurate measurement and reporting require data on inputs, application rates and crop yields. ESG compliance support can help businesses develop reporting systems that meet regulatory standards.

Finally, businesses should consider how policy momentum around agricultural sustainability may affect customer expectations and regulatory requirements. The Farm to Fork strategy set ambitious targets for fertiliser and pesticide reduction. Although implementation has been uneven, the direction of travel is clear. Businesses that adapt early may be better positioned as standards tighten and market expectations shift.

Where to find further information

The European Commission published details of the Fertiliser Action Plan on its press centre. The announcement includes information on financial support, production measures and supply chain security.

Greenpeace EU published an open letter calling for structural reform to reduce fossil input dependency. The letter outlines alternative approaches including agroecology, legume production and nutrient recycling.

The Heinrich Böll Foundation published an analysis explaining why fossil fuel-based fertilisers represent a weak link in Europe’s food security. The report examines the connection between gas prices and agricultural resilience.

Euronews covered the link between energy and food bills in its reporting on the fertiliser plan. The article includes comments from Commissioner Hansen and details on emergency support measures.

Businesses seeking practical guidance on reducing input costs, improving nutrient efficiency or meeting sustainability requirements can find resources through the SBS Academy, which offers training on supply chain sustainability and emissions reporting.