EuroChem

Background

EuroChem is one of Europe and the worldโ€™s largest synthetic fertilizer companies.1โ€œFERTILIZERS MARKET – GROWTH, TRENDS, COVID-19 IMPACT, AND FORECASTS (2022 – 2027),โ€ Mordon Intelligence. Archived August 1, 2022. Archive URL: https://archive.ph/DUYxn 2โ€œMineral Fertilizers Market Size and Emerging Trends 2022-2028 | Growing Acceptance of Advanced Chemical Fertilizers & Government Subsidies to Encourage Market Growth, Predicts The Brainy Insights,โ€ Global Newswire, March 1, 2022. Archived August 1, 2022. Archive URL: https://archive.ph/n6N6f 

According to reporting by Reuters, EuroChem produces roughly 5 percent of the global fertilizer supply.3David Gauthier-Villars and Gabriela Baczynska, โ€œEXCLUSIVE How a Russian billionaire shielded assets from European sanctions,โ€ Reuters, June 1, 2022. Archived August 1, 2022. Archive URL: https://archive.ph/1LfZ2 

According to EuroChemโ€™s 2021 annual report, the company sells โ€œnearly 20 million tonnes of fertilizers a yearโ€ and generates annual revenues of โ€œsome US$10 billionโ€ while employing โ€œover 27,000 people worldwide.โ€ According to the report, EuroChemโ€™s revenues in 2021 increased by 66 percent over 2020, and fertilizer sales volumes increased by 7 percent. The company also stated that it aims to become the third largest fertilizer corporation in the world in both production and sales by 2026.4โ€œ20 years of growth – 2021 Integrated Report,โ€ EuroChem. Archived August 1, 2022. Archive URL: https://archive.ph/efSEV 

According to its 2021 annual report, EuroChem had a turnover of US$10.2 billion in 2021. The company reported sales by volume of: 34 percent nitrogen products, 14 percent complex fertilizers, 11 percent phosphates products, 9 percent potash fertilizers, 22 percent mining products, and 10 percent industrial products.5โ€œ20 years of growth – 2021 Integrated Report,โ€ EuroChem. Archived August 1, 2022. Archive URL: https://archive.ph/efSEV  

According to EuroChemโ€™s 2020 annual report, Europe accounted for 27 percent of EuroChemโ€™s sales and Latin America for 25 percent of sales. North America and Asia-Pacific each accounted for 16 percent of sales, Russia for 14 percent, and Africa for 2 percent.6โ€œResilience in action – 2020 Annual Reports and Accounts,โ€ EuroChem. Archived August 1, 2022. Archive URL: https://archive.ph/pyUvP

EuroChem was founded in Russia, where the majority of its subsidiaries are based. It is registered in Zug, Switzerland, the capital of the Swiss canton Zug.7โ€œ20 years of growth – 2021 Integrated Report,โ€ EuroChem. Archived August 1, 2022. Archive URL: https://archive.ph/efSEV

In addition to fertilizers, EuroChem is also involved in oil and gas exploration, production, and processing, as well as mining and chemical manufacturing.8โ€œ20 years of growth – 2021 Integrated Report,โ€ EuroChem. Archived August 1, 2022. Archive URL: https://archive.ph/efSEV

Although headquartered in Switzerland, EuroChem was founded by Russian billionaire Andrey Melnichenko, and the majority of its subsidiaries are based in Russia. Its Russian operations include mining, ammonia production, and manufacturing, as well as the production and processing of natural gas.9โ€œResilience in action – 2020 Annual Reports and Accounts,โ€ EuroChem. Archived August 1, 2022. Archive URL: https://archive.ph/pyUvP

Following Russiaโ€™s invasion of Ukraine in February 2022, both Melnichenko โ€“ who had been the non-executive director of the board of directors โ€“ and EuroChemโ€™s former CEO, Vladimir Rashevskiy, were sanctioned by the EU in March 2022. Both then resigned from the company.10Alexander H. Tullo, โ€œChemical industry under pressure to cut ties with Russia,โ€ Chemical & Engineering News, March 17, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/eCBaC 11โ€œAndrey Melnichenko resigns from EuroChem Board of Directors and withdraws as main beneficiary,โ€ EuroChem, March 10, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/TA7F1

Following Russiaโ€™s invasion, Swiss authorities initially froze the companyโ€™s bank account and paused its operations, later saying that EuroChem must โ€œtake the necessary measures within the Swiss legal system to allow the company to continue to exist.โ€12โ€œSwitzerland unfreezes EuroChem accounts after change of beneficiary – paper,โ€ Interfax, May 23, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/FxMIP 13โ€œEuroChem in Antwerp can start producing fertilizer again,โ€ IEDE News, April 13, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/G1EBv 14Brenna Hughes Neghaiwi. โ€œUPDATE 2-EuroChem must show sanctions compliance after those imposed on Melnichenko, Swiss say,โ€ Reuters, June 10, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/tBxf7

Swiss authorities freed EuroChemโ€™s accounts in May 2022, after ownership of the company was transferred, in trust, to Melnichenkoโ€™s wife Aleksandra Melnichenko โ€“ who later also came under sanctions from the EU.15โ€œEuroChem Group statement on ownership and control,โ€ EuroChem, June 21, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/qYh2d 16โ€œCOUNCIL IMPLEMENTING REGULATION (EU) 2022/878 of 3 June 2022,โ€ Official Journal of the European Union, June 3, 2022. Archived August 2, 2022. Archived .pdf on file at DeSmog.

In light of the sanctions, Norwegian fertilizer producer Yara temporarily suspended purchases from EuroChem, and Austrian chemical company and fertilizer manufacturer Borealis announced that it would be refusing EuroChemโ€™s offer to purchase its nitrogen business.17James Burgess and Jeffrey McDonald. โ€œAmmonia, urea producer Yara halts purchases from sanctions-hit Russian suppliers,โ€ S&P Global Commodity Insights, March 11, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/5ThBq 18โ€œBorealis declines EuroChemโ€™s offer for the acquisition of fertilizer, melamine and technical nitrogen business,โ€ Borealis Group, March 10, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/EBP2F 

In July 2022, EuroChem called on the European Commission to โ€œpro-actively inform EU Member States that all actors in the food and fertilizer sector, EuroChem Group AG included, are free from EU sanctions.โ€19โ€œEuroChem calls upon European Commission to take action to protect fertilizer supply chain,โ€ EuroChem, July 26, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/ouWxb

A significant proportion of global fertilizer operations are based in Russia. According to analysis by Dutch lender Rabobank, Russia accounts for over 40 percent of potash exports, over 20 percent of ammonia exports, and over 45 percent of ammonium nitrate exports โ€“ all either components of or finished fertilizer products.20โ€œThe Russia-Ukraine Warโ€™s Impact on Global Fertilizer Markets,โ€ Rabo-Research, April 2022. Archived August 2, 2022. Archive URL: https://archive.ph/eWKad 

Fertilizer production globally was severely disrupted by Russiaโ€™s invasion of Ukraine and subsequent sanctions. The conflict contributed to already rising fertilizer prices, which have increased nearly 30 percent since the start of 2022, on top of an 80 percent increase in 2021.21John Baffeswee and Chian Koh. โ€œFertilizer prices expected to remain higher for longer,โ€ May 11, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/Hpkxi

In July 2022, the European Commission proposed paused tariffs on goods used to produce fertilizer until 2024.22โ€œCommission proposes to temporarily scrap tariffs on goods used to produce fertiliser,โ€ European Commission, July 19, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/7a8Kh

EuroChem has opposed the European Unionโ€™s plans to become carbon neutral by 2050, a key plank of the European Green Deal.23EuroChem. โ€œAdditional comments on the CBAM consultation,โ€ European Commission, October 28, 2020. Archived August 1, 2022. Archived .pdf on file at DeSmog.

EuroChem has also argued against EU environmental farming legislation, stating: โ€œEuropean farmers are already struggling under excessive burdensome environmental legislations.โ€24EuroChem. โ€œAdditional comments on the consultation โ€˜Healthy soils โ€“ new EU soil strategyโ€™,โ€ European Commission, April 27, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog.

EuroChem has repeatedly criticized the Farm to Fork Strategy (F2F), the EUโ€™s plans for reducing agricultureโ€™s impacts on the environment and climate. EuroChem has called Farm to Forkโ€™s synthetic fertilizer reduction targets โ€œpointless and counterproductive.โ€25EuroChem, โ€œOur additional comments on the consultation โ€˜Towards zero pollution in air, water and soil โ€“ EU action planโ€™,โ€ European Commission, February 10, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog.

Stance on Climate Change

EuroChem states in its 2021 annual report that climate change โ€œis having a direct and destructive impact on the planet, largely due to the impact of greenhouse gas emissions (GHG) which trap heat and force temperatures up,โ€ adding that โ€œwe all have an urgent duty to reduce these damaging effects and secure our global future.โ€26โ€œ20 years of growth – 2021 Integrated Report,โ€ EuroChem. Archived August 1, 2022. Archive URL: https://archive.ph/efSEV 

In the report, EuroChem states that its GHG emissions have increased since 2020 by around 2.5 percent, to 37,500 tons a year. EuroChem claims that it is developing a climate-focused environmental, social, and governance (ESG) strategy to โ€œimplement GHG emissions reduction actions wherever possible.โ€ 

EuroChem also suggests in the report that it plans to significantly increase its fertilizer production in coming years.27โ€œ20 years of growth – 2021 Integrated Report,โ€ EuroChem. Archived August 1, 2022. Archive URL: https://archive.ph/efSEV EuroChemโ€™s products include nitrogen produced from ammonia that is predominantly derived from carbon-intensive fossil fuel feedstock.28โ€œResilience in action – 2020 Annual Reports and Accounts,โ€ EuroChem. Archived August 1, 2022. Archive URL: https://archive.ph/pyUvP 

EuroChem nonetheless suggests that its products offer climate solutions, writing that its products will help farmers โ€œunder pressure to produce greater volumes of food from shrinking areas of arable land.โ€29โ€œAbout us,โ€ EuroChem. Archived August 1, 2022. Archive URL:  https://archive.ph/VAGMY

EuroChem has opposed the European Unionโ€™s plans to become carbon neutral by 2050, a key plank of the European Green Deal. In 2020 comments about the carbon border adjustment mechanism, EuroChem told the European Commission that it โ€œdoubt[ed]โ€ whether pursuing carbon neutrality was the โ€œright pathโ€ for the EU, and stated that carbon neutral industrial production represented โ€œan enormous or even impossible technological challengeโ€ that would result in a โ€œhuge loss of prosperity for European citizens.โ€30EuroChem. โ€œAdditional comments on the CBAM consultation,โ€ European Commission, October 28, 2020. Archived August 1, 2022. Archived .pdf on file at DeSmog.

EuroChem has also argued against EU environmental farming legislation, stating: โ€œEuropean farmers are already struggling under excessive burdensome environmental legislations.โ€31EuroChem. โ€œAdditional comments on the consultation โ€˜Healthy soils โ€“ new EU soil strategyโ€™,โ€ European Commission, April 27, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog.

EuroChem has repeatedly criticized the Farm to Fork Strategy (F2F), the EUโ€™s plans for reducing agricultureโ€™s impacts on the environment and climate. EuroChem has called Farm to Forkโ€™s synthetic fertilizer reduction targets โ€œpointless and counterproductive.โ€32EuroChem. โ€œOur additional comments on the consultation โ€˜Towards zero pollution in air, water and soil โ€“ EU action planโ€™,โ€ European Commission, February 10, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog.

Impacts of Fertilizers on Climate Change

The global food system accounts for around 30 percent of global human-driven greenhouse gas emissions. Experts consider the sector โ€œa key driver of climate change.โ€33Tim G. Benton, Carling Bieg, Helen Harwatt, Roshan Pudasaini and Laura Wellesley, โ€œFood system impacts on biodiversity loss – Three levers for food system transformation in support of nature,โ€ Chatham House, February 2021. Archived August 2, 2022. Archived .pdf on file at DeSmog. 

Synthetic fertilizers are a major contributor to the food sectorโ€™s carbon footprint, because methane (or โ€œnaturalโ€) gas is the primary feedstock for synthetic fertilizer production.34โ€œHow Fertilizer Is Making Climate Change Worse,โ€ GRAIN, November 1,2021 Archived November 25, 2021. Archive URL: https://archive.ph/wip/7sbQ7 

Once in use, both organic and synthetic nitrogen fertilizers emit significant quantities of nitrous oxide (NO2), a greenhouse gas that traps 300 times more heat than CO2 and can remain in the atmosphere for decades.35Daisy Dunne.โ€œNitrogen fertilizer use could โ€˜threaten global climate goalsโ€™,โ€ Carbon Brief, September 7, 2020. Archived November 25, 2021. Archive URL: https://archive.fo/L9DNY 36โ€œTackling climate change,โ€ European Commission, Archived December 3, 2021. Archive URL: https://archive.ph/vKMzc

Over the past four decades, rising use of nitrogen-based fertilizers has driven up global emissions of NO2.37Daisy Dunne.โ€œNitrogen fertilizer use could โ€˜threaten global climate goalsโ€™,โ€ Carbon Brief, September 7, 2020. Archived November 25, 2021. Archive URL: https://archive.fo/L9DNY

Today the global climate impact of nitrogen fertilizer alone is greater than the impacts of commercial aviation, contributing roughly 2 percent of all global emissions.38Dana Drugmand, Steven Feit, Lili Fuhr, and Carroll Muffett, โ€œFossils, Fertilizers, and False Solutions: How Laundering Fossil Fuels in Agrochemicals Puts the Climate and the Planet at Risk,โ€ Centre for International Environmental Law, October 2022. Archived November 1, 2022. Archived .pdf on file at DeSmog. 39GRAIN, Greenpeace International and Institute for Agriculture and Trade Policy (IATP). โ€œNew research shows 50 year binge on chemical fertilisers must end to address the climate crisis,โ€ November 1, 2021. Archived August 2, 2022. Archive URL: https://archive.ph/7sbQ7

In May 2020, the EUโ€™s Farm to Fork strategy set a goal to reduce at least 20 percent of nutrient losses on EU farms by 2030, which could translate into a 20 percent reduction in synthetic fertilizer use.40โ€œEU Farm to Fork Strategy,โ€ European Commission. Archived on November 25, 2021, Archive URL: https://archive.ph/wip/d0SZD 41Kerstine Appunn. โ€œEUโ€™s Farm to Fork strategy impacts climate, productivity and trade,โ€ Clean Energy Wire, March 5, 2021. Archived November 26, 2021. Archive URL: https://archive.fo/iwt40

Stance on โ€œIntensificationโ€ as Climate and Biodiversity Solution

EuroChem lobbies for โ€œintensificationโ€ โ€“ producing more food on the same amount of land, with synthetic fertilizers playing a key role โ€“ as a solution to the biodiversity, soil health, and climate crises. 

In 2021, in response to Brusselsโ€™ plans on land use and land change, EuroChem sent the European Commission a paper exploring possible policy approaches: intensification and โ€œextensification,โ€ or expanding the amount of land used for food production.42Thomas Mannheim, Catarina Henka, EuroChem. โ€œIntensive Landwirtschaft und Schutz der Biodiversitรคt – Ein Widerspruch? Intensive Landwirtschaft ist Teil des Biodiversitรคtsschutzes,โ€ European Commission, November 2019. Archived August 1, 2022. Archived .pdf on file at DeSmog.

The paper, which EuroChem had published in 2019, argued that synthetic fertilizers had a role to play in โ€œsustainable intensification,โ€ through targeted use contributing โ€œsignificantly to high yieldsโ€ without increasing the amount of land devoted to food production. By contrast, according to the paper, agricultural practices that minimized or eliminated use of synthetic fertilizers, such as organic farming, would lead to conversion of more land to agricultural use to achieve the same yields, further harming biodiversity and climate:43Thomas Mannheim, Catarina Henka, EuroChem. โ€œIntensive Landwirtschaft und Schutz der Biodiversitรคt – Ein Widerspruch? Intensive Landwirtschaft ist Teil des Biodiversitรคtsschutzes,โ€ European Commission, November 2019. Archived August 1, 2022. Archived .pdf on file at DeSmog. 44โ€œContributions โ€“ LULUCF Revision – 2021,โ€ European Commission, 2021. Archived August 1, 2022. Archived .csv on file at DeSmog.

 โ€œOnly through a sustainable intensification of agricultural production climate objectives and food security can be jointly achieved whilst securing the economic survival of EU farmersโ€ฆ[T]he EU must urgently abandon its extensification strategy for agriculture laid out in the Farm-to-Fork strategy, e.g. 25% organic farming by 2030, as considerably less food per hectare is produced with organic farming.โ€ 

It concluded: โ€œReduction targets [on fertilizer use] would have even more detrimental effects.โ€

In 2021, EuroChem repeated this message in its public consultation response to the โ€œNew EU Soil Strategy – healthy soil for a healthy life,โ€ proposal, stating that โ€œthe Commissionโ€™s extensification strategy of increasing organic farming by 25% is both absurd and detrimental.โ€45EuroChem. โ€œAdditional comments on the consultation โ€˜Healthy soils โ€“ new EU soil strategyโ€™,โ€ European Commission, April 27, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog. 46โ€œContributions โ€“ Healthy soils โ€“ new EU soil strategy,โ€ European Commission, February 2, 2021 – April 27, 2021. Archived August 1, 2022. Archived .cvs on file at DeSmog. 

Academics, NGOs and policy makers have sharply challenged claims that intensification can provide a climate and biodiversity solution. 

In 2015, the CGIAR research program on Climate Change, Agriculture and Food Security examined whether โ€˜sustainable intensificationโ€™ could sufficiently reduce the emissions from agriculture. It found that: โ€œNeither business-as-usual intensification of agriculture nor moderate adoption of mitigation practices will reduce emissions enough to avoid a 2-degree C temperature increase in 2100 compared to pre-industrial levels.โ€47Julianna White, โ€œSustainable intensification will not keep us within the 2-degree goal for 2030,โ€ CGIAR research program on Climate Change, Agriculture and Food Security, April 9, 2015. Archived July 28, 2022. Archive URL: https://archive.ph/W5F8P 

The argument that fertilizer use is a necessary solution to global food needs has also been widely criticized.48Sarah Yang. โ€œCan organic crops compete with industrial agriculture?,โ€ Berkeley News, December 9, 2014. Archived July 28, 2022. Archive URL: https://archive.ph/OWD0C 

โ€œ[Attempts to] grow more by spreading more nitrogen fertiliser and destroying what is still ecologically useful will only further deteriorate the production capacity of agricultural systems,โ€ according to agronomist Pierre-Marie Aubert, from French think tank IDDRI.49Harald Schumann, Nico Schmidt and Alicia Prager. โ€œThe battle over pesticides in Europe,โ€ Investigate Europe, June 24, 2022. Archived July 28, 2022. Archive URL: https://archive.ph/POsZd

Yet, agribusiness interests are using these arguments to โ€œlock-inโ€ dependence on industrial, chemical-intensive forms of farming, which are harming both biodiversity and climate, according to the International Panel of Experts on Sustainable Food Systems (IPES-Food).50โ€œFrom Uniformity to Diversity โ€“ A paradigm shift from industrial agriculture to diversifed agroecological systems,โ€  International Panel of Experts on Sustainable Food Systems, 2016. Archived July 28, 2022. Archive URL: https://archive.ph/rrzNt

Stance on Sustainable Agriculture and Pollution Reduction Plans

EuroChem has lobbied against key elements of the EUโ€™s Green Deal related to fertilizers and farming. 

In February 2021, the company submitted a response to the European Commissionโ€™s Public Consultation on the EUโ€™s action plan towards zero pollution of air, water and soil.51EuroChem. โ€œOur additional comments on the consultation โ€˜Towards zero pollution in air, water and soil โ€“ EU action planโ€™,โ€ European Commission, February 10, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog. The plan aims to reduce air, water, and soil pollution to โ€œlevels no longer considered harmful to health and natural ecosystemsโ€ by 2050. It includes key targets to improve soil quality, by reducing nutrient losses (which largely come from synthetic fertilizers) and chemical pesticide use by 50 percent.

Its response stated that the consultation process was โ€œmissing considerations of the huge agronomic and economic benefits of agriculture in general and specifically of fertilization ensuring food production and providing affordable high-quality food for millions of consumers in the EU and worldwide.โ€52EuroChem. โ€œOur additional comments on the consultation โ€˜Towards zero pollution in air, water and soil โ€“ EU action planโ€™,โ€ European Commission, February 10, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog.

EuroChem accused the commission of being unrealistic by trying โ€œto present the image of an ideal world, without saying that such an unrealistic scenario leads to a severe disruption of social and economic activities.โ€ EuroChem argued that โ€œquantitative reduction targets for fertilizers on EU level, as indicated in the F2F, is pointless and counterproductive.โ€ EuroChem advocated for managing nutrient levels at a regional level, and suggested that additional monitoring of pollution was โ€œcertainly not necessary,โ€ because the agricultural sector already had โ€œwell-establishedโ€ systems in place.53EuroChem. โ€œOur additional comments on the consultation โ€˜Towards zero pollution in air, water and soil โ€“ EU action planโ€™,โ€ European Commission, February 10, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog. 

EuroChemโ€™s criticism of the legislation hinged on a 2020 impact assessment of Farm to Fork by the U.S. Department of Agriculture (USDA) that examined the effect that the Farm to Fork Strategy could have on agricultural production and farmer revenues. The USDAโ€™s analysis found that Farm to Fork could lead to significant reductions in EU agricultural production, and possible rises in consumer prices and imports.54Jayson Beckman, Maros Ivanic, Jeremy L. Jelliffe, Felix G. Baquedano, and Sara G. Scott. โ€œEconomic and Food Security Impacts of Agricultural Input Reduction Under the European Union Green Dealโ€™s Farm to Fork and Biodiversity Strategies,โ€ United States Department of Agriculture Economic Research Service, November 2020. Archived December 15, 2022. Archived .pdf on file at DeSmog.

EuroChemโ€™s submission claimed that the USDA study โ€œconfirm[ed] our strong concerns.โ€55EuroChem. โ€œOur additional comments on the consultation โ€˜Towards zero pollution in air, water and soil โ€“ EU action planโ€™โ€, European Commission, February 10, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog.

The USDA study is one of seven impact assessments conducted to date on the impacts of Farm to Fork. Of the seven studies, five have been financed and shaped by major industry players.56Nina Holland and Rachel Tansey. โ€œA loud lobby for a silent spring: the pesticide industryโ€™s toxic lobbying tactics against Farm to Fork,โ€ Corporate Europe Observatory, December 2021. Archived May 24, 2022. Archived .pdf on file at DeSmog.

Multiple NGOs and academics have criticized the studies, arguing that they only give a โ€œpartial and incompleteโ€ picture of the EUโ€™s plans.57Alice Poiron. โ€œWhy Attacks Against the EU Farm to Fork Strategy Completely Miss the Point,โ€ Slow Food, February 9, 2022. Archived October 25, 2022. Archive URL: https://archive.ph/hwUqD For example, they do not consider positive impacts from more sustainable production, such as the impact that a more thriving bee population could have on crop pollination.58Nina Holland and Rachel Tansey. โ€œA loud lobby for a silent spring: the pesticide industryโ€™s toxic lobbying tactics against Farm to Fork,โ€ Corporate Europe Observatory, December 2021. Archived May 24, 2022. Archived .pdf on file at DeSmog. They also fail to consider what will happen if no action is taken, and climate breakdown and biodiversity loss lead to a global crisis in food production.59โ€œGreen Deal targets for 2030 and agricultural production studies โ€“ Fact Sheet,โ€ European Commission, February 2022. Archived August 4, 2022. Archived .pdf on file at DeSmog.

Lobby watchdog Corporate Europe Observatory accused industry members of using the studies โ€œto scaremonger about economic losses while painting an unfair pictureโ€ about the impact of F2Fโ€™s fertilizer reduction targets.60โ€œA loud lobby for a silent spring: The pesticide industryโ€™s lobbying tactics against Farm to Fork.,โ€ Corporate Europe Observatory, March 17, 2022. Archived July 26, 2022. Archive PDF: https://archive.ph/hpFb3 

Agrochemical interests including EuroChem have widely called for the European Commission to conduct its own impact assessment.61EuroChem. โ€œOur additional comments on the consultation โ€˜Towards zero pollution in air, water and soil โ€“ EU action planโ€™,โ€ European Commission, February 10, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog.

In July 2021, EuroChem Head of Public Affairs Igor Shmidt wrote in Fertilizer International Magazine:62Facebook post by EuroChem, July 23, 2021. Archived August 1, 2022. Archived .png on file at DeSmog. 

โ€œRegrettably, the European Commission has shied away from presenting its own comprehensive impact assessment of the Farm to Fork Strategy, while being critical of other institutions, such as the US Department of Agriculture (USDA), that have willingly undertaken such studies. 

Corporate Europe Observatory stated that โ€œsuch assessments tend to favour economic factors over social and environmental ones, only delaying progress towards tackling the climate emergency.โ€63Vicky Cann. โ€œExploiting the Ukraine crisis for Big Business,โ€ Corporate Europe Observatory, July 28, 2022. Archived October 25, 2022. Archive URL: https://archive.ph/dSLE8

Stance on EU Soil Strategy

In EuroChemโ€™s response to the EU Soil Strategy, a policy plan for improving soil health to help foster biodiversity and capture atmospheric carbon, the company stated that โ€œEuropean farmers are already struggling under excessive burdensome environmental legislations.โ€64EuroChem. โ€œAdditional comments on the consultation โ€˜Healthy soils โ€“ new EU soil strategyโ€™,โ€ European Commission, April 27, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog.

EuroChem has argued that issues such as pollution and soil health should be managed by Member States, rather than by EU-wide legislation.65EuroChem. โ€œOur additional comments on the consultation โ€˜Towards zero pollution in air, water and soil โ€“ EU action planโ€™,โ€ European Commission, February 10, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog. 66EuroChem. โ€œAdditional comments on the consultation โ€˜Healthy soils โ€“ new EU soil strategyโ€™,โ€ European Commission, April 27, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog.

In April 2021, EuroChem stated that โ€œsoil has no cross-border effect and, consequently, no EU legal framework for soil should be introduced in the future.โ€67EuroChem. โ€œAdditional comments on the consultation โ€˜Healthy soils โ€“ new EU soil strategyโ€™,โ€ European Commission, April 27, 2021. Archived August 1, 2022. Archived .pdf on file at DeSmog.

Stance on Carbon Border Adjustment Mechanisms

In 2020, EuroChem responded to the European Commissionโ€™s plans for a carbon border adjustment mechanism (CBAM). The plans aimed to level the costs of higher-emission imports with products produced under stricter carbon-neutral targets in the EU.68EuroChem. โ€œAdditional comments on the CBAM consultation,โ€ European Commission, October 28, 2020. Archived August 1, 2022. Archived .pdf on file at DeSmog.

EuroChem suggested that climate policies were being โ€œmisused as modified trade defense instruments to protect EU companies from better performing competitors outside Europe.โ€ 

EuroChem continued:

โ€œThe European Commission is also spreading false rhetoric by claiming that the EUโ€™s trading partners will hesitate to impose counter-measures once a CBAM is introduced. Being international and working with many international governments, we can affirmatively state that they will not hesitate a minute to take counter-measures.โ€ 

EuroChem suggested that the EU was imposing CBAM โ€œwithout proper consultation at international level with other key global trading partners.โ€ 

EuroChem suggested that because of this, the measures would โ€œundercut and undermine the global dialogue on climate, discouraging and potentially leading to countriesโ€™ withdrawals altogether.โ€ 

EuroChem also suggested that CBAM would be โ€œcounterproductive for the EU fertilizer industry to innovate and to decarbonize.โ€ According to the company, the EU should focus instead on designing a โ€œbusiness-friendlyโ€ framework to support decarbonization technologies, particularly carbon capture, utilization, and storage (CCUS).69EuroChem. โ€œAdditional comments on the CBAM consultation,โ€ European Commission, October 28, 2020. Archived August 1, 2022. Archived .pdf on file at DeSmog.

Funding

According to its 2021 annual report, EuroChem had a turnover of US$10.2 billion in 2021. The company reported the following sales by volume to be: 34% nitrogen, 14% complex, 11% phosphates, 9% potash, 22% mining products, 10% industrial products.70โ€œ20 years of growth – 2021 Integrated Report,โ€ EuroChem. Archived August 1, 2022. Archive URL: https://archive.ph/efSEV  

According to its 2020 annual report, Europe accounted for 27% of EuroChemโ€™s sales and Latin America for 25 percent of sales. North America and Asia-Pacific each accounted for 16 percent of sales, , Russia for 14 percent, and Africa for 2 percent.71โ€œResilience in action – 2020 Annual Reports and Accounts,โ€ EuroChem. Archived August 1, 2022. Archive URL: https://archive.ph/pyUvP

Lobbying

EuroChem spent 100,000 – 199,999 euros on lobbying in 2020, according to the EU transparency register.72โ€œEuroChem Group AG,โ€ EU Transparency Register, November 15, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/2jJ9v 

Between 2018 and 2020, EuroChem spent 550,000 – 750,000 euros in total, and in 2020 employed two lobbyists registered in the EU Transparency Register.73โ€œEuroChem Group AG,โ€ LobbyFacts.eu. Archived August 2, 2022. Archive URL: https://archive.ph/p8H8J 

EuroChem states that its primary policy targets are legislation and plans involving:74โ€œEuroChem Group AG,โ€ EU Transparency Register, November 15, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/2jJ9v

  • Fertilizer regulation
  • Industry and trade
  • Energy
  • Agriculture policy, such as the Common Agricultural Policy
  • Environmental regulations, including soil, water, and air
  • Chemical regulations or REACH
  • Climate change and energy policies such as the EU Emission Trading Scheme or CBAM

EuroChem did not disclose any meetings held with senior members of the European Commission in 2021.75โ€œEuroChem Group AG,โ€ EU Transparency Register, November 15, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/2jJ9v

Affiliations

EuroChem is a member of the European Chemical Industry Council (CEFIC).76โ€œList of Corporate Members (ACOM),โ€ CEFIC, May 2022. Archived December 19, 2022. Archived .pdf on file at DeSmog.

EuroChem was previously a member of Fertilizers Europe. In March 2022, Fertilizers Europe announced that in response to Russiaโ€™s invasion of Ukraine and EU sanctions of Melnichenko, it had โ€œdecided to suspend the membership of EuroChem Group as of 23 March 2022. An Extraordinary General Assembly will be called towards end of April to take a formal decision on EuroChemโ€™s membership.โ€77โ€œFertilizers Europe Suspends the Membership of EuroChem Group,โ€ Fertilizers Europe, March 23, 2022. Archived August 2, 2022. Archive .pdf on file at DeSmog. 

As of November 2022, EuroChem was no longer listed as a member of the industry group.78โ€œMembers,โ€ Fertilizers Europe. Archived August 2, 2022. Archive URL: https://archive.ph/I258Q

EuroChemโ€™s 2022 submission to the EU Transparency Register stated that it was a member of the International Fertilizer Association (IFA).79โ€œEuroChem Group AG,โ€ EU Transparency Register, November 15, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/2jJ9v 

However, the company was no longer listed on the IFAโ€™s membership list.80โ€œOur Members,โ€ International Fertilizer Association. Archived August 2, 2022. Archive URL: https://archive.ph/O9BxA.

EuroChemโ€™s Transparency Register entry also stated that โ€œEuroChem Group is through its production and sales, R&D locations also a member of the national fertilizer associations throughout the EU and abroad (e.g. Industrieverband Agrar).โ€81โ€œEuroChem Group AG,โ€ EU Transparency Register, November 15, 2022. Archived August 2, 2022. Archive URL: https://archive.ph/2jJ9v

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