Urea imports down. Urea production up, imports down in April-November 2022

As the government aims to make India self sufficient in urea production, the latest data show that the increase in production until November in the current fiscal helped the country in meeting surging demand, despite a cut in imports. However, better coordination with States can further improve the situation amid reported scarcity of the fertilizer during this rabi season, experts said.

Out of annual demand of about 35 million tonnes (mt) of urea, the domestic production was stagnant at about 25 mt for last many years, while import was 8-10 mt depending on monsoon and other factors.

According to official data, import of urea during April-November has dropped 4.7 per cent to 4.61 mt from 4.84 mt in the year-ago period. But, production of urea has jumped 14.4 per cent to 18.72 mt from 16.36 mt and sales too have surged 6.7 per cent to 23.2 mt from 21.76 mt.

“The availability in current fiscal from this year’s production and import was a notch higher than sales. This may create problem for next kharif season unless there is some alternative arrangement made,” said an industry representative. The problem of urea shortage may reappear next year unless the government more closely manages the movement, he added.

He further said that while sale of urea in this October, the starting period of rabi sowing season, was about 2 mt, similar to a year-ago period, there was a spurt in sales in November to 3.94 mt from 3.13 mt year-ago. Farmers purchased more than required urea after media reports pointed out shortages, he added.

Earlier this month, Union Minister of Chemicals and Fertilizers Mansukh Mandaviya had said that India would become self-sufficient in urea by 2025. The minister said that concrete steps have been taken to promote ‘Make in India’ in the fertilizer sector by reviving five closed urea plants. The government has also launched ‘One Nation One Fertilizer’ scheme under ‘Bharat’ brand to cut excessive usage of a particular brand.

Among other fertilizers, sales of Di-ammonium Phosphate (DAP) have surged 18.3 per cent to 8.34 mt from 7.05 mt, Muriate of Potash (MoP) declined 42 per cent to 1.12 mt from 1.93 mt and complex (NPKS) dipped 18 per cent to 7.41 mt from 9.03 mt. On the other hand, import of all these fertilizers have increased during April-November.

Import of DAP have gone up by 45 per cent to 5.3 mt, complex fertilizers by 91 per cent to 1.9 mt and MoP by 10 per cent to 1.2 mt, data show. While entire MoP is imported, as high as 80 per cent of DAP gets imported while in complex, the domestic production has 75 per cent share though raw materials of these fertilizers are imported.

With the help of public sector undertakings (PSUs), three urea plants at Gorakhpur, Sindri and Barauni have been revived while another unit in Talcher is likely to be operational by 2024. Ramagundam plant, recently inaugurated by the prime minister, has also been revived through a joint venture company owned by National Fertilizers Limited (NFL) and other PSUs.