European fertilizer importers brought in just 179,877 tonnes of nitrogen fertilizer in January 2026, a dramatic decrease from the nearly 1.2 million tonnes imported in January 2025, according to newly released data. The plunge in imports coincides with the impending implementation of the European Union’s Carbon Border Adjustment Mechanism (CBAM), set to take effect for fertilizer imports beginning in 2026.
The CBAM aims to establish a level playing field by ensuring that importers face similar carbon costs to those incurred by producers within the EU. The mechanism is intended to prevent “carbon leakage,” where production shifts to countries with less stringent climate regulations. As outlined by the European Commission, the CBAM will initially apply to select carbon-intensive goods, including fertilizers, cement, iron and steel, aluminum, electricity, and hydrogen.
Agricultural groups had warned of potential disruptions and increased costs prior to the release of the import figures. The core concern centers on the potential for increased fertilizer prices and reduced availability, impacting farmers across the EU. The German Agricultural Association, for example, had voiced concerns about the competitiveness of European agriculture in the face of these new costs.
The CBAM operates by requiring importers to purchase CBAM certificates corresponding to the carbon emissions embedded in the goods they import. The price of these certificates will be linked to the EU Emissions Trading System (EU ETS) carbon price. According to the European Commission, the CBAM is designed to complement the existing EU ETS, which already places a price on carbon emissions from installations within the EU.
Recent adjustments to the CBAM, announced in October 2025, offer some relief to smaller importers. A threshold of 50 tonnes of relevant goods per year has been established, exempting smaller companies from the CBAM requirements. This simplification, part of the “Omnibus Package I,” aims to reduce the administrative burden on smaller businesses, according to a joint press release from the German Environment Agency (UBA) and the Federal Ministry for the Environment, Nature Conservation, Nuclear Safety and Climate Action (BMUKN).
Despite the simplification for smaller importers, the significant drop in fertilizer imports suggests a substantial immediate impact. The EU’s CBAM system is intended to mirror the carbon costs already borne by domestic producers, gradually replacing the free allocation of EU ETS allowances. The German Federal Ministry for Economic Affairs and Climate Action has stated that the CBAM is intended to incentivize investment in climate-friendly technologies within the European industrial sector.
On January 9, 2026, the German authorities announced a new TARIC subheading code for active processing under CBAM, indicating ongoing implementation efforts. Further implementing acts and a review report were published on December 19, 2025, detailing the regulations for the CBAM’s initial phase, which began January 1, 2026. The European Commission has not yet responded to requests for comment on the initial import data.
