The NFU has called on the government to ensure the UK’s incoming Carbon Border Adjustment Mechanism (CBAM) does not put British food producers at a competitive disadvantage to imports.
The warning follows the publication of illustrative CBAM rates, with the NFU concerned that the mechanism will increase costs for farmers already facing inflationary pressures.
NFU Deputy President Paul Tompkins said the UK’s reliance on imported ammonia, used to manufacture fertiliser, meant domestic farmers would be exposed to the additional costs.
“Unbelievably, food grown overseas with fertiliser will not be subject to the same tax, leaving domestic food production at a competitive disadvantage,” he said.
The NFU is urging the Chancellor to use the forthcoming Budget to reduce the cost of food production, strengthen resilience and restore confidence in farming businesses.
“If government is true to its word that ‘food security is national security’, then the Chancellor must announce measures at the Budget that actually reduces the cost of producing food, not increases it,” Tompkins said.