India Has Adequate Fertiliser Supply for Kharif Season, FAI Assures

The Fertiliser Association of India (FAI) has assured that Urea and Phosphatic fertiliser supplies are adequate for the upcoming Kharif season, despite concerns over global geopolitical tensions and their potential impact on trade and logistics.

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

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 a sufficient cushion to meet agricultural demand.

Supply Chain Coordination

The fertiliser industry says it 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.

Seasonal Demand and Inventory Replenishment

India is currently entering the agricultural lean season, with the major 0Kharif 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.

Production and Inventory Status

In the first ten months of the year, India has reported higher fertiliser production and imports of Urea, DAP, Complex, SSP and MOP - 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.

Challenges and Mitigation Strategies

The 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.

Diversification in Phosphatic Fertilisers

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

Long-Term Supply Agreements

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.

Potential Price Impact and Subsidy Concerns

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. (ANI)

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