Import of urea down by 14% amid price falls globally; sales up by 2%
Nearly 60% of the budgeted amount for fertilizer subsidies has already been spent, but from April to August of the current fiscal year, sales have gone up by 2% while urea imports have gone down by 14%.
According to the most recent data, the fertilizer subsidy for the first five months of the current fiscal year was ₹61,449 crore (₹47,790 crores for urea and ₹13,659 crores for P&K), while the budgeted amount was ₹1.05 lakh crore, of which ₹63,222 crore was for urea.
A rise in prices around the world has led the government to think that the subsidy for fertilizer will be more than ₹2 lakh crore in FY23. But imports have dropped, and the prices of urea and Di-ammonium Phosphate (DAP) around the world have gone down since August when they were at their highest (during the current fiscal).
DAP, MoP prices
In May, the average price to import urea was $722/tonne, but in August, it was $593/tonne, and the average price to import DAP was $891/tonne, down from $936/tonne in May and $945/tonne in July. Muriate of Potash (MOP), on the other hand, has stayed the same at $590/tonne since March 2022.
From April to August, urea sales were put at 144.52 lakh tonnes (lt), which was up 1.8% from the same time last year. DAP sales were put at 40.33 lt, which was up 12.7%. But sales of MOP, which is mostly used in horticulture and plantation crops, fell by 54.8% to 5.4 lt, and sales of complex, which is a mix of nitrogen (N), phosphorus (P), and potassium (K), fell by 22.4% to 40.12 lt.
Other goods come in
On the other hand, imports of urea dropped from 29.02 lt to 25.11 lt from April to August of this fiscal year. All of the other fertilizers that were brought in went up: DAP by 16.3% to 24.7 lt, MOP by 11.8% to 7.12 lt, and complex by 152% to 13.78 lt.
‘The retail price of MOP is about ₹1,700 per 50 kg bag, which is the most expensive of all fertilizers. DAP is the next most expensive at ₹1,350 per bag, and urea is the cheapest at less than ₹300 per bag. Farmers have stopped using MOP, but imports have gone up by 75,000 tonnes compared to the same time last year. This could be because of problems with logistics since importers sometimes get their orders early,’ said an industry official.
Even though the total amount of urea produced until August 2022-23 was 116.2 lt, compared to about 100 lt the year before, more nano-urea is being sold this year. Between April 1 and August 10, IFFCO, a large cooperative, is said to have put 1.23 crore 500-ml bottles on the market. One bottle is the same as one bag of 45 kg of urea with neem on it.