Fertiliser supply fears grow as cashflow and global risks mount

Pressure is mounting on the government to act on fertiliser supply, as industry leaders warn of growing risks to farm cashflow and future food security.

The Agricultural Industries Confederation (AIC) has written to Defra setting out four key priorities aimed at strengthening fertiliser supply resilience and market confidence.

The letter outlines four main pressure points facing the industry — access to finance, data transparency, carbon policy and sanctions — all of which are already influencing farmer purchasing decisions ahead of the next season.

The body has highlighted increasing strain on farm cashflow, with access to credit affecting fertiliser purchasing decisions. It is urging the government to explore options to support credit lines for fertiliser purchases, helping to reduce disruption and stabilise the market.

It has also called on Defra to consider introducing a national fertiliser recording system, similar to those used in the Republic of Ireland and Northern Ireland.

Such a system would improve transparency around fertiliser volumes, including on-farm stocks and carry-over, and strengthen national oversight of supply.

Clarity over the UK Carbon Border Adjustment Mechanism (CBAM) is another key concern.

It warned uncertainty around how the scheme will apply to fertiliser — including default carbon footprints and free allowance thresholds — is creating significant uncertainty for importers planning purchases months in advance.

It said delaying clarity until late 2026 is “unworkable” given how far ahead fertiliser is ordered, and risks adding further strain to the wider food supply chain.

Fertiliser markets have faced volatility in recent years due to global supply disruption and high energy costs, increasing pressure on both suppliers and farmers. Ongoing geopolitical tensions, including the US–Iran conflict, have added further uncertainty to global fertiliser supply and prices.

Further concerns have been raised over sanctions linked to Russian-owned fertiliser production facilities operating within Europe.

It said a lack of clear guidance on sanctions interpretation and banking restrictions is hindering lawful trade and distorting the market compared with other European countries.

Despite these challenges, the organisation said it remains committed to working with government, providing evidence and market intelligence to support the sector.

AIC head of fertiliser sector Jo Gilbertson said: “While many UK farms may have secured their fertiliser requirements for this year, we cannot overlook the potential impact that ongoing global disruption could have on supply chains in 2026 and 2027.”

He added that while the government has limited control over internationally traded fertilisers, domestic policy still plays a vital role in maintaining confidence and supporting food security.

“The government’s proposal for a new UK Fertiliser Regulation is something AIC has long called for and very much welcomes,” he said.

“It is also important that all available options to support UK agriculture are considered, which is why AIC has written to Ministers setting out four specific asks.”