• Around 60-70% of fertiliser-related GHG emissions 1occur during fertiliser use; the rest occur during production. In total, fertilisers emit around 1.23 Gt CO2 equivalent per year globally.

• The emissions intensity of ammonia has fallen by 1.1% annually over the last 10 years, driven primarily by improvements in energy efficiency.

• Excluding policies such as CO2 pricing, ammonia production today is estimated to cost2 on average 30% more using carbon capture and storage (CCS) and three times more using electrolysis when compared to conventional routes. Scale and narrowing price differentials with fossil fuels can help to reduce this gap.

• Globally, low-emissions ammonia production projects for fertilisers account for 19 Mt (less than 10% of total production), including operational projects and those that have reached final investment decision (FID) or completed feasibility studies.

• Emissions from fertiliser use need to be cut by around 70% to reach net zero by 2050 according to the International Fertilizer Association3, through improved nitrogen use efficiency (NUE), use of inhibitors to reduce losses, crop rotation and land sparing, with residual emissions sequestered in the soil.

• NUE varies across regions, but the global average needs to increase from 55% to 70% by 2050 in the above scenario, more than doubling the recent annual growth rate.

Governments should convene a multi-stakeholder process to move towards common understandings of definitions for low- and near-zero emissions fertilisers that encompass the full fertiliser production chain from hydrogen and ammonia synthesis to final product formulation. This should look to develop harmonised lifecycle emissions accounting methodologies, establish an internationally recognised certification and labelling system, and make use of these methodologies and systems within relevant policies. The process should be closely co-ordinated with relevant work from initiatives in the hydrogen sector to ensure compatibility across value chains.

Governments and initiatives should agree to establish a global set of guidelines that define metrics and thresholds to promote and track soil health. This should include efforts to systematically report and monitor indicators of soil health, crop productivity, and fertiliser use, as well as an agreement to share information.

Separately, governments, research organisations and companies should agree to establish global standards for biologicals, including performance validation protocols to foster trust, enable cross-border trade and accelerate uptake.

Governments should co-ordinate joint public procurement, demand aggregation or regulatory measures to create demand for near-zero emissions fertilisers at a scale sufficient to drive investment, innovation and cost reduction.

The private sector should complement these efforts and establish commitments for their use, including through collaborative procurement and joint purchasing agreements. Where appropriate, these efforts should be linked to broader hydrogen and ammonia lead market initiatives to ensure fertiliser applications are included in supply allocation.

Governments, in collaboration with technical institutions, should agree to align on international guidance for measuring nitrogen use efficiency (NUE), with a view to establishing a globally accepted NUE range, and should encourage countries to sign a pledge to reach that level within a specified timeline.

Governments, multilateral development banks and development finance institutions should scale up dedicated financing for low- and near-zero emissions fertiliser production and expand investment in innovative financing mechanisms that help smallholder and commercial farmers adopt practices that improve soil health. Financing should be paired with technical assistance, advisory services and monitoring tools. These programmes should build on existing funding mechanisms for low-emissions hydrogen and be expanded to explicitly support fertiliser-related projects.

Financial incentives, such as agricultural subsidies for fertilisers, need to be tailored to encourage optimal fertiliser use, including increased use of biologicals, and promoting soil health. Cross-border collaboration needs to be enhanced for pooling financial resources, mobilising international climate finance and sharing best practices for implementing effective policies for incentivising soil health, and equitable access to financial resources.