Raw material prices may be impacted: Fertiliser body

The Fertiliser Association of India (FAI) said Urea and Phosphatic fertiliser supplies remain adequate to meet agricultural requirements for the forthcoming Kharif season.

Listen to this article

While global developments, including geopolitical tensions in West Asia, have raised concerns about potential disruptions to fertiliser trade and logistics, current inventory levels and supply arrangements are expected to provide sufficient cushion to meet agricultural demand, FAI spokesperson said in a statement.

The fertiliser industry is working closely with the Government of India, state governments and other stakeholders to ensure smooth distribution of fertilisers across regions. Production planning, imports and logistics are being actively coordinated to maintain adequate availability during the upcoming cropping season, it added.

India is currently entering the agricultural lean season, with the major Kharif sowing period expected to begin in June. During this phase, fertiliser consumption typically remains moderate, allowing the industry to replenish inventories and undertake routine maintenance operations at production facilities, the company said.

In the first ten months of the year, India has reported higher fertiliser production and imports of Urea, Diammonium phosphate (DAP), Complex, Single Super Phosphate and Muriate of Potassium – moving from 57 million tons last year to 65 million tons in FY25-26.

With consistent production of Urea, DAP and NPKs and timely imports, India currently holds adequate inventory of key nutrients to ensure that farm-level demand can be met without disruption. DAP & NPK inventories have gone up by 70-80% over last year corresponding period, giving adequate comfort to manage the temporary disruption in any supplies from Middle East.

Fertiliser sector is highly dependent on imported RLNG for production of urea, with significant supplies of LNG coming from Middle East. The current disruption has impacted gas supplies and industry is working closely with the Government for prioritizing gas allocation for Urea production. With some plants under annual maintenance, industry is optimizing gas allocation to ensure sufficient supply of Urea for the ensuing season.

In case of Phosphatics fertilisers, India has diversified supplies and long term arrangements, and is sourcing from nations such as Morocco, Jordan, Saudi Arabia, Russia and Belarus, which partially offsets supply disruption risks from one region.

Indian fertiliser companies viz IPL, Coromandel, PPL have long term supply arrangements with global producers. These companies often secure annual or multi-year contracts for phosphoric acid, ammonia, and rock phosphate, which can help stabilize supplies in the short term. However, the current geopolitical disturbances can impact prices of these key raw materials like Sulphur and Ammonia and industry will be working closely with the Government for ensuring that Nutrient based Subsidy rates for the kharif season adequately factors spurt in raw material prices and exchange rate.

India imports 30 per cent of its fertiliser requirement and the Middle East supplies 40 per cent of it. The country also depends on this region for 30 per cent of its imports of key raw materials and intermediates, such as rock phosphate, phosphoric acid and muriate of potash, according to Crisil Ratings.

 

 

Latest

India Post records highest ever Q1 revenue

The Minister held Business Review Meeting with all 23...

MRF ranked India’s most valuable tyre brand

The company also featured among the Top 50 most...

Aditya Birla Group buys Shell’s renewable arm for $1.8 bln

The company will make the acquisition from Shell Overseas...

TVS Emerald to develop residential project in West Chennai

The Koyembedu–Poonamallee corridor, a rapidly expanding residential micro-market that...

Newsletter

Don't miss

India Post records highest ever Q1 revenue

The Minister held Business Review Meeting with all 23...

MRF ranked India’s most valuable tyre brand

The company also featured among the Top 50 most...

Aditya Birla Group buys Shell’s renewable arm for $1.8 bln

The company will make the acquisition from Shell Overseas...

TVS Emerald to develop residential project in West Chennai

The Koyembedu–Poonamallee corridor, a rapidly expanding residential micro-market that...

Retail Inflation crosses 4% in June

“Food inflation contributed 185 basis points (bps), while non-food...

India Post records highest ever Q1 revenue

The Minister held Business Review Meeting with all 23 Circles of India Post, which reviewed performance and charted the roadmap for the months ahead. India...

MRF ranked India’s most valuable tyre brand

The company also featured among the Top 50 most valuable brands in India across sectors in the report. Brand Finance India report, unveiled under the...

Aditya Birla Group buys Shell’s renewable arm for $1.8 bln

The company will make the acquisition from Shell Overseas Investment B.V and the transaction is amongst the largest acquisitions in India’s renewable energy sector...