Assessing environment impacts of chemical fertilizers consumption in Australia: State-level evidence

The applications of chemical fertilizer have raised significant environmental concern in Australia. This paper examines the impacts of NPK fertilizers applications on soil, water, and air using econometric models based on states level data from 1990 to 2023 in Australia. This study applied the Pooled Mean Group model to assess short and long-run relationships. The Dumitrescu–Hurlin causality was tested to examine directional linkages, and DOLS confirmed robustness. The findings confirm that the consumption of nitrogen, phosphate, and potash-based fertilizers has a strong impact on soil pollution in the long run. Nitrogen and phosphate fertilizers significantly affect water pollution, while nitrogen and potash contribute to air pollution in the long run. The impacts of soil and water pollution caused by chemical fertilizers are more pronounced in New South Wales and Victoria. However, Queensland experiences higher air pollution levels. In the short run, nitrogen-based fertilizers have a strong impact on soil, water, and air pollution. Phosphate based fertilizers affect soil and water, while potash based fertilizers have no short-run causal impacts. Thus, findings suggest that policymakers should be aware of control use of chemical fertilizers through applying regulatory mechanism and introduce green fertilizers for implement the vision of net zero emissions. • NPK fertilizer consumption has strong impact on soil pollution in the long run. • QLD experiences higher air pollution levels compared to NSW and VIC. • N-based fertilizers have short-run strong impact on soil, water, and air pollution. • Phosphate fertilizers are a causal factor in soil and water pollution. • Potash-based fertilizers have no measurable short-run impact on soil, water, or air pollution.