Fertiliser sales have increased by 2.5 per cent in the first quarter of the current fiscal, from a year ago, to touch 102.12 lakh tonnes (lt), as there was a significant increase in demand in June despite the delayed and deficient monsoon. As a result, the subsidy in the April-June period accounts for 26 per cent of the budget estimate of Rs 1.75 lakh crore for 2023-24 fiscal. Higher sales may also help fertiliser companies increase their earnings, negating any likely adverse impact on consumption after the launch of the single ‘Bharat’ brand for all subsidised crop nutrients.
“All eyes are on July, which saw maximum fertiliser sales as this is a crucial sowing window as well as the highest rainfall period during the monsoon season. Since the precipitation is on the positive side, except in the southern peninsula, the consumption is likely to exceed the level seen during July 2022,” said SK Singh, an agriculture scientist. The sale of 66.55 lt fertilisers in July 2022 is the highest monthly figure during the kharif season, official data show.
During the annual kharif conference in May, Union Agriculture Minister Narendra Singh Tomar had expressed concern over the rising use of chemical fertilisers. He wondered why there was no decrease in the demand for chemical fertilizer despite the launch of nano-urea and various schemes for organic/natural farming. The government had recently announced a new PM-PRANAM scheme to pass on 50 per cent of the subsidy saved from reduction of chemical fertilisers.
While the monsoon rainfall in June was 10 per cent lower than normal, there was 15 per cent above-normal precipitation during July 1-19.
According to fertiliser ministry data, sale of urea touched 61.83 lt in April-June 2023-24, up by 1.6 per cent from 60.84 lt a year ago. The government is still hopeful of a reduction in conventional urea consumption after the introduction of nano-urea, which is not subsidised.
Di-ammonium phosphate (DAP) sales surged 5 per cent to 21.9 lt against 20.86 lt and those of complex (combination of key nutrients) by 5.1 per cent to 16.12 lt from 15.34 lt. However, sales of muriate of potash (MoP) dipped 12 per cent to 2.27 lt from 2.58 lt.
Imports
Despite lower sales, import of MoP has doubled to 7.92 lt during the first quarter, whereas DAP import recorded a 51.7 per cent increase to 20.88 lt from 13.76 and that of complex surged 11.4 per cent to 8.57 lt from 7.69 lt. But urea import, which is controlled by the government, fell 20.8 per cent to 11.41 lt from 14.4 lt.
“The closing stocks of MoP in 2022-23 were negligible as sales dropped last year, and companies had cut imports. However, MoP sales will take some time to return to normal since it remains costlier than other fertilisers,” said PS Gahlaut, CEO and managing director of Indian Potash (IPL).
Supply of MoP, for which India is 100 per cent dependent on imports, dropped 21 per cent while sales too fell 33 per cent last fiscal.
Subsidy load
Meanwhile, fertiliser subsidy has touched Rs 46,236.38 crore — urea Rs 30,201.09 crore; and phosphorus and potash Rs 16,035.29 crore — during the April-June quarter, whereas the budget estimate for 2023-24 is Rs 1,75,103.37 crore. The government has enforced, from January 2023, mandatory sales of urea, DAP and MoP under a single ‘Bharat’ brand.
Sale of chemical fertilisers is also linked to irrigation as farmers in irrigated areas use more crop nutrients than those in rainfed areas, said AK Singh, former vice-chancellor of Gwalior Agriculture University. As the share of irrigated areas, mostly from groundwater sources, is rising every year, so is fertiliser consumption, he added.
“Unless the availability of organic manure is increased, the usage of chemical fertilisers may not be reduced,” Singh said, adding that the Indian Council of Agricultural Research (ICAR) had long back recommended the use of 25 per cent bio-fertilisers.