Ministers are considering suspending a carbon tax on fertilisers scheduled to start early next year to curb food inflation. The proposal would be paired with suspending import tariffs on foods such as bread, biscuits, and bananas. Government sources are also considering suspending tariffs on fertilisers to discourage farmers from leaving fields fallow, since rising costs can make selling the 2027 crop unprofitable. Tension exists between the Treasury and the Department for Business and Trade because suspending the carbon tax would require amending the Finance Act 2026. Fertiliser prices have risen sharply due to the Iran conflict, including disruption through the Strait of Hormuz, with producers warning new tariffs could add about £100 per tonne to costs.
"Fertiliser costs have soared since the beginning of the Iran conflict, during which the strait of Hormuz has been closed. About 35% of the world's fertiliser passes through the waterway and, since the conflict broke out in February, about 1m tonnes of fertiliser have been stranded in the Gulf. Fertiliser producers said they expected the new tariffs, which were being put in place to match an existing EU scheme, could add 100 per tonne to costs."
Read at www.theguardian.com
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