The European agricultural industry is set to be the largest victim of the incoming Donald Trump tariffs. While the White House aims to cut EU’s significant trade surplus with the US in the sector, the European Parliament prepares to hold a crucial plenary vote on 22 May 2025. European farmers, especially those working for small and medium-sized enterprises (SMEs), may soon find themselves in a double whammy, simultaneously losing access to their second largest market and traditional supply of cheap fertilizers.

The proposed tariffs, strongly advocated by prominent European fertilizer producers such as Yara International and Grupa Azoty, ostensibly aim to counteract geopolitical pressures and reduce dependency on potentially coercive Russian influences. However, industry experts warn that the immediate and most severe impacts will disproportionately fall upon smaller agricultural businesses and distributors. The measure risks plunging an already strained agricultural sector into deeper crisis, with fertilizer prices potentially surging by 20% to 100% from current levels. In 2024, Russia accounted for roughly one quarter of the EU’s imported fertilizers, valued at €2 billion. The tariffs set to climb from around €40 per metric ton initially to as high as €430 after three years.

While the EU recently caved to their farmers and agreed to impose restrictions on Ukrainian agricultural imports, the removal of cheap fertilizer products they have long relied on to keep the costs down may easily reignite their rage. European farmers are notoriously rowdy and would not hesitate to take it to the streets, block roads and paralyze capitals once again.

The Russian gas shutoff saga may serve as a cautionary tale. While it was meant to choke a vital source of revenue for the Kremlin’s military economy and spur the green transition in Europe itself. But it failed to make to meaningfully dent Russia’s war budget and left the aforementioned European fertilizer producers high and dry with no immediate substitute for the cheap supply source they had relied for decades. German heavy industry suffered, factories closed and consumers across the continent faced swelling energy bills. For all that, there is still no end in sight for the war in Ukraine. The fact that Europe actually continues to devour Russian gas at record speed despite cutoff only makes the entire situation more absurd.

Historically, the EU deliberately excluded fertilizers from sanctions against Russia to prevent disruptions in agricultural inputs vital to European food security. This policy, clearly articulated by the International Food Policy Research Institute (IFPRI) in November 2022, highlighted the severe risks of fertilizer shortages, soaring input costs, and resultant agricultural inflation. Despite these earlier warnings, pressure from major European fertilizer producers has steadily intensified, leading to the Commission’s controversial proposal in January 2025, championed by Trade Commissioner Maroš Šefčovič and receiving significant backing from Fertilizers Europe, a powerful industry lobby group.

Copa-Cogeca, the influential voice of EU farmers and cooperatives, alongside associations from France, Italy and Spain, has condemned the fertilizer tariffs plan as ignoring the “concerns and proposals of agriculture.” The group has alleged that the European Parliament’s International Trade Committee sidelined input from major agricultural producers like France, Germany, Italy and Spain, instead prioritizing Latvia — a country that ranks 14th in the EU for agricultural output and contributed just 1.5% of the 2024 harvest. Without a safety net, the duties could trigger a cascade of consequences: higher production costs, increased food prices for consumers and widespread farm closures, particularly among SMEs. Millions of jobs in the sector hang in the balance, Copa-Cogeca warns.

Fianna Fáil MEP Barry Cowen recently urged the European Commission to reconsider its approach to proposed tariffs on fertilizer imports. The Midlands North-West representative made the appeal in light of a new report warning of a sharp upward trend in fertilizer prices for 2025.

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Fine Gael MEP Maria Walsh noted that “Irish farmers face the highest fertilizer costs in the European Union”.

“The recent Rabobank report highlights the continued increase in the price of fertilizer in 2025, resulting in a decrease of the purchasing power of farmers. We are in a particularly vulnerable position due to our reliance on imported fertilizers,” she said.

The Rabobank report, published in April, forecasts another challenging year for the global fertilizer market – particularly nitrogen and phosphate-based products.

The report also flags the EU’s proposed import tariffs as a major contributing factor to potential price shocks.

Right after the proposed regulation was voted on 5 May 2025 by the Committee on Agriculture and Rural Development, Mireia Borrás Pabón of Patriots for Europe Group made a public statement, saying: “I would like all Europeans to know as well that what’s happened here, from my point of view, is a disgrace. We know that the tariffs are not going to solve the problems that we have in competitiveness of the European industry or any other problem. <…> The way that we’ve been treated is lack of respect not only to the farmers, but also to the citizens that voted for us democratically.”

Independent Ireland MEP Ciaran Mullooly voiced his disappointment at the outcome of the vote in the International Trade (INTA) Committee, which is the lead committee on this legislation, followed by a vote at plenary (full sitting) of the EU Parliament, “despite strong requests from myself, fellow MEPs and farmers groups not only in Ireland but throughout Europe”.

He claimed that the new tariffs will “inevitably lead to higher prices to be paid by our farmers within the next 18 months”.

“The mad rush to push this through flew in the face of lots of genuine efforts by MEPs of all sides to bring amendments – a fact that wasn’t forgotten by other MEPs from other countries who spoke after the vote on the committee,” he said.

Critically, despite the potentially devastating impacts, the European Commission admits that no detailed impact assessment has been carried out for the tariff proposal. This lack of due diligence raises serious concerns regarding the thoroughness and transparency of policymaking processes. SMEs, already vulnerable to economic fluctuations, may bear the brunt of these insufficiently analyzed policy measures, calling into question the broader accountability and fairness of such significant regulatory decisions.

The potential consequences for smaller market players could be irreversible. Independent studies and market analyses forecast that fertilizer prices could surge by 20–30%, significantly increasing operational costs for SMEs already struggling under the weight of existing economic pressures. Fertilizers constitute between 10–30% of variable costs in crop production, and the proposed tariffs could force small agricultural businesses into severe economic hardship, with many potentially facing bankruptcy.

Small distributors, characterized by limited storage capacity and inflexible procurement strategies, will encounter acute disruptions. Unlike large corporations capable of swiftly reallocating resources or absorbing temporary losses, SMEs lack such financial agility and purchasing power. Consequently, they may struggle to maintain stable supplies, potentially driving customers toward larger distributors who can secure more reliable, albeit costly, fertilizer stocks.

Furthermore, SMEs engaged in farming will be forced to choose between drastically higher input costs or reducing fertilizer use. Reduced fertilizer application invariably leads to lower yields and compromised profitability, creating a vicious economic cycle that could undermine local agricultural sustainability and food security. While the European Commission suggests alternative suppliers from regions such as North Africa, the Middle East, and the U.S. could compensate for reduced Russian and Belarusian imports, industry insiders remain skeptical. Transitioning supply chains on such short notice presents considerable logistical hurdles, particularly for SMEs with limited resources.

At the same time, the tariffs' principal beneficiaries—large-scale European fertilizer producers—stand to gain significant market advantages. Industry titans such as Yara International, Grupa Azoty, LAT Nitrogen, and Fertiglobe, having directly lobbied for these measures, are positioned to benefit financially from the artificially elevated prices and reduced external competition (S&P Global, Jan 2025). Although their lobbying activities have been framed within broader narratives of security and economic resilience, underlying commercial motivations are evident and raise legitimate questions about policy fairness and market equity.

It should be noted that European fertilizer producers took a big hit as a result of the continent weaning itself of cheap Russian gas and could use some support, even if the number of people employed in the sector is a small fraction compared to millions working on farms. But instead of helping, the Brussels tariff plan risks only frustrating them due to the slow rollout and bad timing. The EU simply took too long to act. Tiffanie Stephani, vice president at Norway-based Yara, one of the world’s largest fertilizer producers, says the measures won’t be felt soon enough. “We appreciate that the Commission is taking measures to reduce imports of Russian fertilizers, but unfortunately, it is too little, too late,” Stephani said.

As it stands, the tariff plan may end up hurting some industries badly, frustrating others and jeopardizing European food security. Without decisive measures to protect vulnerable market players, the EU risks exacerbating economic disparities and compromising agricultural stability, while still falling short of their geopolitical objectives.

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