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New Ross fertilizer group
announces price deal

A lbatros Fertilizers Ltd., one of the major Irish blenders, has announced new fertilizer prices, which will have a significant effect on farming input costs. Due to a doubling of energy costs and a decision by European manufacturers to severely cut production, bringing supply in line with demand, Irish farmers will face increases of 30 to 40 per cent in the next few weeks.

James Kennedy, who has recently taken over as Group Chief Executive of the Thomas McDonogh Group, owners of Albatros Fertilizers Ltd., New Ross, Co. Wexford, said there was no avoiding the new reality of the market in which production has been cut back and oil and gas prices the major component of fertilizer manufacturing costs have risen to record levels.

The British industry has already established a new pricing structure to reflect the dramatic changes in the market - product is currently costing up to 30 per cent more in Northern Ireland than in the Republic. British farmers have also accepted that this price will increase progressively each month to April next.

Gerald Bonington of Norsk Hydro, the biggest producer of fertilizers in Western Europe, commenting on the European market, said that over the past 12 months in the UK, the price of nitrogen fertilizer has gone up by 50 per cent. While Irish prices had moved upwards in the 2000 season, the increase did not reflect the current market conditions in the UK and Europe.

"The expectation in the UK is that prices will increase between now and next April by another 15 per tonne," says Mr. Bonington. "Prices have already risen by 10 a tonne since July and that structure has become well established."

In relation to Albatros and the Irish market, Mr. Kennedy said the new reality was that:

* Main European producers of blend components and straight nitrogen products have closed four million tonnes of production capacity in the past year, bringing the supply and demand situation into balance, which has resulted in major price increases

* Oil and gas prices have increased by 100 per cent over the past eighteen months and energy costs constitute a major portion of the cost of fertilizers

* The US dollar has increased in value by 15 per cent against the IR in the past year and added significantly to the cost of fertilizers

* Domestic haulage rates have also increased considerably during the past year as a result of oil prices.

"Albatros Fertilizers remain committed to maintaining price competitiveness and ensuring that Irish farmers get the best possible value for money in the current circumstances," said Mr. Kennedy.

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