The latest update on Europe's Fertilizer supply chain and the impact of Covid-19 during the industry's key season from the Editor of Argus Europe Fertilizer.
Listen in as David Maher, Editor - Europe Fertilizer, explains how Europe's markets have kept moving during their key season, spring, despite the ongoing challenges posed by Covid-19. It also examines how geography and the nature of the EU have played key roles.
Transcript
Hello. This is David Maher, editor of "Fertilizer Europe." Welcome to this podcast. A few of the editors are speaking on COVID-19 and the impact on various markets. So I'll be looking at Europe. The title is actually "COVID-19 in Europe: Coping during the Key Season." Most of us will know what I mean by that. It's spring. So, basically, it is key time for fertilizers in Europe, for agriculture in Europe, for inputs to crops and grasslands.
In a way, the coronavirus pandemic could not have come at a more, shall we say, interesting time for the market. At certain other times of the year, had it been late summer, let's say, the situation would have been different and a little less complicated. As it is, it's been difficult both as the sale suggests, I believe and I feel strongly that the market has been coping very well. So one of the key reasons is necessity. Its links to food production and fertilizer production and deliveries are key inputs. So they are almost essential, not officially essential across Europe, but I'll come to that in a minute. The situation is that the market needs to continue at this time of the year. It cannot be faced with any great disruption because of the impact on societies, essentially. A lack of food production could cause, of course, [inaudible 00:01:35], huge problems. So, for that reason, every effort has been made to keep the market moving as close to normal as possible.
Now, geography has been an important part of this because while seaports have been operating as best as they can, again, as close to normal as possible, and production has been going on at plants albeit with teams of people split into two or three groups and so on to ensure that the spread of the virus is kept to a minimum. However, there have been border problems and land border problems in particular. Central and Eastern Europe have been particularly impacted. This was essentially people getting used to the new normal. It was border crossings not being able to cope with the situation, particularly with regard to people being checked. So even though fertilizers in trucks, for example, that were free to go through and were going to ultimately pass the border without undue problem, nevertheless that didn't stop them being, and hasn't stopped them being part of truck queues that have been up to tens of kilometers long in the worst cases.
Now, people are beginning to cope a little better. And the majority of land borders in Europe, including in the East and, kind of, Central and South East region, the situation has improved and they are flowing more rapidly and more normally. And then, if we go a little more further West, barge shipments for example, key barge shipments of C.A.N. heading into Germany from the Benelux countries pretty much undisrupted. As I said, it will always, as people adjust into the new normal combined with the necessity of fertilizers.
That brings me on to a little point about necessity, and, sort of, connected are similar words which is essential. People have been asking me about this. I've had emails come through to me from China, for example, asking about whether Europe has applied an official essential tag to fertilizers. The most basic answer to that is that the E.U. is not a state, so it's much more difficult for continent-wide or even single-market-wide for such a designation to be made. Countries have done, or are tantamount to naming fertilizer product as essential, Spain, Belgium, Italy amongst them. But an E.U.-wide designation is close to impossible. Politically, it's an extremely difficult thing to get done, particularly in a short amount of time. There is no presidential-like order, for example, that can be issued without a great amount of challenges.
Now, there are, of course...I don't know if you heard of these so-called green lanes, but basically what the green lanes are...it's where they'll keep products to run across borders as quickly as they can whilst, I guess, people who aren't involved in essential industries or are traveling for other reasons cannot use them. So, overall, these reasons, although not named as an essential product, as an official E.U. block-wide level, effectively, that's how it's working.
The markets have been busy. In fact, they've been extra-busy for the very reason that people want to get products in just in case that regulations do come into play that prevent them from doing so. So, in some cases, people are stocking up a few weeks ahead of where they normally would, just in case something happens and restrictions become detrimental to the movement of fertilizers. And, as I said, this is actually made, but is already in a normal year a very busy part of the season, an extra-busy part of the season. At least that's how it's going for the time being. And production has continued. Producers have been clever about how they've administered operations. People are working from home where they can. But those that cannot, as I said a little bit earlier, split into teams of two or three and as best they can ensure that production is close to normal levels.
Okay. That's about it from me. Thank you very much for listening. All the best for luck in the weeks and months ahead with the situation. For a lot more, by the way on all of this impact on fertilizers and other sectors, please go to argusmedia.com/coronavirus. Thanks very much.
In a way, the coronavirus pandemic could not have come at a more, shall we say, interesting time for the market. At certain other times of the year, had it been late summer, let's say, the situation would have been different and a little less complicated. As it is, it's been difficult both as the sale suggests, I believe and I feel strongly that the market has been coping very well. So one of the key reasons is necessity. Its links to food production and fertilizer production and deliveries are key inputs. So they are almost essential, not officially essential across Europe, but I'll come to that in a minute. The situation is that the market needs to continue at this time of the year. It cannot be faced with any great disruption because of the impact on societies, essentially. A lack of food production could cause, of course, [inaudible 00:01:35], huge problems. So, for that reason, every effort has been made to keep the market moving as close to normal as possible.
Now, geography has been an important part of this because while seaports have been operating as best as they can, again, as close to normal as possible, and production has been going on at plants albeit with teams of people split into two or three groups and so on to ensure that the spread of the virus is kept to a minimum. However, there have been border problems and land border problems in particular. Central and Eastern Europe have been particularly impacted. This was essentially people getting used to the new normal. It was border crossings not being able to cope with the situation, particularly with regard to people being checked. So even though fertilizers in trucks, for example, that were free to go through and were going to ultimately pass the border without undue problem, nevertheless that didn't stop them being, and hasn't stopped them being part of truck queues that have been up to tens of kilometers long in the worst cases.
Now, people are beginning to cope a little better. And the majority of land borders in Europe, including in the East and, kind of, Central and South East region, the situation has improved and they are flowing more rapidly and more normally. And then, if we go a little more further West, barge shipments for example, key barge shipments of C.A.N. heading into Germany from the Benelux countries pretty much undisrupted. As I said, it will always, as people adjust into the new normal combined with the necessity of fertilizers.
That brings me on to a little point about necessity, and, sort of, connected are similar words which is essential. People have been asking me about this. I've had emails come through to me from China, for example, asking about whether Europe has applied an official essential tag to fertilizers. The most basic answer to that is that the E.U. is not a state, so it's much more difficult for continent-wide or even single-market-wide for such a designation to be made. Countries have done, or are tantamount to naming fertilizer product as essential, Spain, Belgium, Italy amongst them. But an E.U.-wide designation is close to impossible. Politically, it's an extremely difficult thing to get done, particularly in a short amount of time. There is no presidential-like order, for example, that can be issued without a great amount of challenges.
Now, there are, of course...I don't know if you heard of these so-called green lanes, but basically what the green lanes are...it's where they'll keep products to run across borders as quickly as they can whilst, I guess, people who aren't involved in essential industries or are traveling for other reasons cannot use them. So, overall, these reasons, although not named as an essential product, as an official E.U. block-wide level, effectively, that's how it's working.
The markets have been busy. In fact, they've been extra-busy for the very reason that people want to get products in just in case that regulations do come into play that prevent them from doing so. So, in some cases, people are stocking up a few weeks ahead of where they normally would, just in case something happens and restrictions become detrimental to the movement of fertilizers. And, as I said, this is actually made, but is already in a normal year a very busy part of the season, an extra-busy part of the season. At least that's how it's going for the time being. And production has continued. Producers have been clever about how they've administered operations. People are working from home where they can. But those that cannot, as I said a little bit earlier, split into teams of two or three and as best they can ensure that production is close to normal levels.
Okay. That's about it from me. Thank you very much for listening. All the best for luck in the weeks and months ahead with the situation. For a lot more, by the way on all of this impact on fertilizers and other sectors, please go to argusmedia.com/coronavirus. Thanks very much.