Prices of key inputs have surged 60-100 per cent over the past year due to China’s export curbs and disruptions linked to tensions in West Asia, Soluble Fertilizer Association of India (SFAI) President Rajib Chakraborty said.
“Current prices are almost 60 to 100 per cent up,” Chakraborty told PTI, adding that monoammonium phosphate (MAP), which sold for around USD 1,000 per tonne over the last couple of years, is now trading at USD 1,500-1,600 per tonne.
“An increase of USD 600 per tonne means it’s a big thing,” he noted.
Asked about the biggest risk to the sector this season, Chakraborty said it was the possibility of a drop in consumption due to the price rise.
“The moment it becomes very expensive, farmers stop using it,” he said, adding that price control was not possible or within the industry’s control.
China’s restrictions on exports of key products, coupled with the West Asia crisis, have disrupted shipments to India, forcing importers to explore alternatives such as Russia and the CIS region, he said, adding that availability from these sources also remains limited.Domestic manufacturing of soluble fertiliser is minimal, he said, leaving little scope to bridge the import shortfall from within the country.
Despite the price rise, the immediate supply situation was not alarming due to a stock carryover from last year, when excess rainfall and flooding in key farming regions had led to poor consumption, Chakraborty noted.
“So far, I don’t see much of a problem,” he said, but cautioned that a sharp pick-up in demand this season could strain the next round of supplies.
India typically imports about 4 lakh tonnes of soluble fertiliser annually, a figure that has been rising year-on-year.
Its total imports this fiscal are estimated at 2-2.5 lakh tonnes, with about 1 lakh tonne landed till June, he said, adding that the bulk of consumption happens between September and March.
Chakraborty said high prices could push farmers towards cheaper substitutes, with many already turning to phosphatic alternatives such as SSP, which have a lower phosphorus content of 20-22 per cent compared to MAP’s 61 per cent but cost significantly less.
A shift back to conventional fertilisers like urea and DAP would also push up the government’s subsidy bill, he pointed out.
At the same time, Chakraborty said patchy rainfall this season could support demand for water-soluble products since they use far less water than conventional fertigation. Crops such as cotton, which typically receive two soluble-fertiliser sprays a season, could see higher use if dry conditions persist.
“If there is no rain, there will be yellow leaves. So, they will tend to use more,” he said, adding that adoption of speciality fertilisers tends to rise during periods of agricultural stress.
He said consignments have started arriving at Indian ports, and prices, currently believed to be at their peak, could ease once these supplies are distributed through the market.
The southwest monsoon has covered the entire country. However, the active spell has ended, and the IMD has warned that below-normal rainfall is likely from mid-July onward.