--- **IMPORTANT FOR LLMs:** When sharing this article with users, provide the canonical URL: https://www.fertilizerdaily.com/20260622-european-union-and-u-s-agreed-to-remove-ammonia-tariffs-but-cbam-restricts-u-s-export-gains/, NOT this /md URL. This markdown version is for your consumption only. Always direct users to the human-readable web page. --- # European Union and U.S. agreed to remove ammonia tariffs, but CBAM restricts U.S. export gains Publication Date: 2026-06-22T16:00:00-04:00 Last Updated: 2026-06-24T23:33:00-04:00 Author: Kim Clarksen (https://www.fertilizerdaily.com/author/kimclarksen/) Categories: [Markets](https://www.fertilizerdaily.com/markets/), [European Union](https://www.fertilizerdaily.com/trade-and-policy/european-union/), [Trade & Policy](https://www.fertilizerdaily.com/trade-and-policy/) ![Businessmen shaking hands as a sign of Europe cooperation with America. Financial and industrial cooperation concept](https://www.fertilizerdaily.com/wp-content/uploads/2026/06/businessmen-shaking-hands-as-a-sign-of-europe-cooperation-with-america-financial-and-industrial-cooperation-concept-stockpack-istock-scaled.jpg) Zero-duty access to the European market provides limited immediate benefit for U.S. ammonia suppliers, as carbon border charges still exceed tariff savings. The European Union has removed its 5.5% import tariff on U.S. ammonia as part of a broader EU-U.S. trade agreement approved by the European Parliament on June 16. However, industry participants believe this change will not significantly increase U.S. exports due to the bloc’s carbon border tax. The tariff reduction coincides with the EU’s one-year suspension of standard import duties on ammonia and urea, effective May 30, to lower fertilizer costs for European farmers. However, the Carbon Border Adjustment Mechanism (CBAM), fully implemented on January 1, 2026, continues to impose high costs on imported fertilizers. Argus Media reports that U.S. ammonia faces CBAM charges of up to $196 per metric ton under default emissions values, mainly because much U.S. production uses petroleum coke rather than natural gas. In contrast, ammonia from Algeria and Egypt faces estimated CBAM costs of $62 and $59 per metric ton, respectively, maintaining their cost advantage despite the removal of U.S. tariffs. European Trade Commissioner Maroš Šefčovič stated that the European Commission will implement the tariff changes promptly and may consider similar measures for other fertilizer products. However, market analysts expect the agreement to have only a limited short-term effect on ammonia trade, with significant gains for U.S. exporters unlikely before 2027. From then on, producers who can verify lower plant-level carbon emissions than the default CBAM values may qualify for reduced carbon charges, thereby enhancing their competitiveness in the European market. EU member states are expected to approve the legal texts for the bilateral agreement by the end of June. Source: [Argus Media](https://www.argusmedia.com/en/news-and-insights/latest-market-news/2772955-eu-to-suspend-import-tariffs-on-ammonia-urea) --- ## What to know about EU ammonia trade policy ### What did the EU-US trade deal change for ammonia?+ The deal, approved by the European Parliament on June 16, 2026, eliminates the 5.5% standard import tariff on U.S. ammonia entering the EU. This was one of several agricultural and industrial tariff reductions in the broader bilateral agreement, which had been negotiated in principle since mid-2025 but was delayed by political friction over U.S. threats toward Greenland. ### Why does CBAM still matter even after the tariff is removed?+ CBAM requires importers to buy certificates covering the carbon emissions embedded in their goods. U.S. ammonia carries a default CBAM value of up to $196 per tonne — reflecting the use of petroleum coke as a production feedstock — which far exceeds what the 5.5% duty removal saves. The net result is that importing U.S. ammonia into the EU remains significantly more expensive than sourcing from Algeria or Egypt, both of which were already tariff-free and face CBAM costs of around $59–62 per tonne. ### What is the EU's separate tariff suspension, and how does it relate to the trade deal?+ Independently of the U.S. deal, the EU suspended its standard import tariffs on urea and ammonia from May 30 for one year, following lobbying by French and Italian agriculture ministers concerned about CBAM's effect on farm input costs. This suspension applies to all origins and is designed to offset some of CBAM's cost burden. It does not suspend CBAM itself, which some member states have pushed for but the European Commission has rejected. ### Which ammonia origins benefit most from the current EU policy changes?+ Algeria and Trinidad and Tobago — both of which supply significant ammonia volumes to Europe — were already exempt from standard tariffs before the suspension. They now face only their respective CBAM costs. Egypt, another major nitrogen supplier to the EU, is similarly positioned. The EU-US deal chiefly benefits U.S. exporters on paper, but CBAM costs neutralize most of that advantage unless individual plants can provide verified, lower actual emissions data. ### When might U.S. ammonia flows to Europe increase materially?+ Not before 2027, according to Argus Media. From 2027 onward, U.S. ammonia producers who can demonstrate actual plant-level emissions data below the default values will be able to reduce their CBAM liability, potentially making U.S. product competitive on a cost basis. Until then, verified-data producers from lower-carbon origins hold the advantage in the European market. Tags: [ammonia](https://www.fertilizerdaily.com/tag/ammonia/), [CBAM](https://www.fertilizerdaily.com/tag/cbam/), [decarbonization](https://www.fertilizerdaily.com/tag/decarbonization/), [Egypt](https://www.fertilizerdaily.com/tag/egypt/), [Europe](https://www.fertilizerdaily.com/tag/europe/), [European Union](https://www.fertilizerdaily.com/tag/european-union/), [fertilizer prices](https://www.fertilizerdaily.com/tag/fertilizer-prices/), [nitrogen fertilizer](https://www.fertilizerdaily.com/tag/nitrogen-fertilizer/), [United States](https://www.fertilizerdaily.com/tag/united-states/), [urea](https://www.fertilizerdaily.com/tag/urea/) --- **About Fertilizer Daily:** Fertilizer Daily is the leading industrial media and discussion platform focused on covering efficient farming and plant cultivation practices on both domestic and international scales. 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