India’s urea production has surged by 25.6 per cent during the first month of the current fiscal to 23.45 lakh tonnes (lt), thanks to the revival of four closed plants in the public sector at Gorakhpur, Sindri, Barauni, and Ramagundam. However, sales were lower at 11.77 lt in April from year-ago, which indicates its comfortable availability as farmers normally rush to store the crop nutrient ahead of sowing in case of shortage.

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Two major fertilisers

According to official data, domestic production of Di-ammonium Phosphate (DAP) increased by 10 per cent to 3.68 lt last month from 3.35 lt year-ago while its import too jumped 11 per cent to 4.54 lt from 4.1 lt. Urea import also reported higher at 2.72 lt from 2.5 lt, up 9 per cent.

“Urea and DAP are two major fertilisers which farmers stock in advance before sowing starts from around June. This year, adequate availability has been ensured by the government, so far, which led to normal sales,” said an industry official. After the launch of one ‘Bharat’ brand fertiliser across the country, companies are also not aggressively pushing sales as was earlier and the new domestic freight subsidy policy also has contributed to the combined sales of all fertilisers remaining almost at par with last year, the official added.

The government has asked companies to concentrate on sales within 500 kilometres of the plants so that the government does not have to bear transport subsidy unnecessarily.

MoP sales

The overall sales of all fertilisers dropped one per cent to 17.91 lt in April from 18.05 lt year-ago, but DAP consumption increased 4 per cent to 3.02 lt from 2.9 lt. Sales of another key fertiliser Muriate of Potash (MoP) dropped 15 per cent to 0.50 lt from 0.59 lt.

“Amid high prices of MoP, compared with other fertilisers, farmers were expecting rationalisation in subsidy policy for all nutrients. However, 37 per cent cut in potash subsidy from Kharif 2022 level and 33 per cent from Rabi 2022 level will not help improve its sales,” an executive of an MoP producing firm said referring to Wednesday’s Cabinet decision on subsidy for ensuing kharif season.

Imports of MoP dropped 32 per cent to 1.18 lt from 1.74 lt and that of complex (combination of N, P and K nutrients) varieties surged 34 per cent to 2.97 lt from 2.21 lt.

Smooth supply

Fertiliser minister Mansukh Mandaviya said that the government in the last nine years has ensured a smooth supply of fertilisers by entering into long-term supply contracts with 13 countries like Canada, Jordan, and Saudi Arabia. “For 70 per cent of our (import) requirement, India has a long-term contract with 13 countries. Earlier, we used to enter the global market only when we require that was leading to fluctuations in the global prices,” Mandaviya said.

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He also emphasised that the retail prices of fertilisers in India are much lower when compared to countries like the US, China, Pakistan, Bangladesh, and Indonesia.

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