Aontú TD for Mayo, Paul Lawless, has warned that the introduction of the Carbon Border Adjustment Mechanism which will place a carbon-based levy on products imported to the EU will lead to further increases in the already-spiralling cost of farm fertiliser.
Deputy Lawless was speaking after representatives from the Irish Cooperative Organisation Society and the Association of Farm and Forestry Contractors in Ireland presented to the Oireachtas Joint Committee on Agriculture, of which he is a member.
Deputy Lawless said: “I am deeply concerned about the introduction of the Carbon Border Adjustment Mechanism (CBAM) and the effect this will have on fertiliser costs. Last year Ireland imported 1.7 million tonnes of fertiliser. In recent weeks we’ve seen the cost of fertilizer increase by about 43%. This carbon levy is now €115 per tonne, and much like the carbon tax in Ireland, this is set to increase incrementally and dramatically in the coming years. Yesterday in the Agriculture Committee we heard that the accumulative cost of this levy could be more than €39 Billion by 2034, and for context that’s about 10% of the current CAP budget”.
Deputy Lawless continued: “We in Aontú believe that CBAM should be suspended to help reduce the cost of fertiliser during this price crisis. It will make us less competitive because the tax is on imports outside of the EU. It will add about another 3 or 4 cent on the cost of production of a litre of milk at a time when there is a significant downward pressure on farm produce like milk. It will have a huge hit on the costs for the tillage sector. Irish MEPs need to work hard to suspend this levy as quickly as possible. The rate of increments on the levy is harsh and steep”.
“This situation is similar to the conversation we’re having about fuel where some of the inflation for sure is because of the conflict in the Middle East, but the taxes and levies are also making the costs worse, and significantly worse, year on year. This levy, coupled with inflation in fertiliser costs and fuel costs, coupled with the carbon taxes in Ireland, will lead to a situation where we’re going to see a spike in the cost of groceries and inflation across the economy. Introducing the CBAM tax at a time where we’re already experiencing price hikes is like throwing water at a flood. It’s very badly timed and should be suspended”, concluded Lawless.
