The company claims that natural gas costs have risen by nearly 40%, unrelated to the conflict in the Gaza Strip.
“The Romanian state has various support mechanisms for large industries stemming from its own energy resources, a key difference from the EU in general – but unfortunately, it does not utilize them. Consequently, while other gas-producing countries worldwide are building new fertilizer plants, and other EU member states have implemented billion-euro packages in recent years to ensure the continuity of large industries, in Romania, Azomures – the last company of its kind – struggles to remain operational,” said CEO Josh Zacharias, according to a company statement.
Azomures further notes that despite ample gas reserves in the region, the European gas market remains significantly more expensive than other industrialized parts of the world (nearly five to ten times higher). Azomures blames state authorities for natural gas policies, citing an oversupply of subsidized gas in Romania. Despite a significant surplus of natural gas traded by Transgaz, the additional gas is not made available to the market, as major producers are not allowed to reallocate it to industrial consumers like Azomures, the statement reads.
The suspension of Azomures operations could have a negative impact on both the industry and agriculture in Romania. Josh Zacharias cites cost pressures due to local inflation, anti-competitive practices, and a forthcoming 1% income tax as contributing factors. “We calculate a 3% reduction in profitability for Romanian farmers due to the multiplier effect of input purchases, plus the taxed income from crop sales. It’s a tragedy unfolding in slow motion,” said Josh Zacharias.
Azomures CEO highlights significant price differences in fertilizers in Romania compared to the rest of Europe, while urging authorities to urgently establish a strategic committee to discuss input security for agriculture and the future of the Romanian agricultural industry as a whole.