Why in news?

India is facing a sharp rise in fertiliser prices due to supply disruptions triggered by the US–Israel–Iran conflict and the closure of the Strait of Hormuz, a key global energy and trade route.

India’s latest urea import tender by Indian Potash Limited saw prices rise to $935–959 per tonne, nearly double the $508–512 per tonne recorded in February by Rashtriya Chemicals and Fertilizers.

What’s in Today’s Article?

• Price Rise Across Key Fertilisers
• Supply Chain Disruptions
• Kharif Season Fertiliser Challenge in India Amid Supply Disruptions
• Addressing India’s Fertiliser Crisis: Alternatives and Policy Options

Price Rise Across Key Fertilisers

• DAP (Di-Ammonium Phosphate): Increased from ~$680–720 to ~$865–925 per tonne.
• Sulphur: Jumped from ~$300–550 to ~$900 per tonne.
• Ammonia: Rose from ~$435 to ~$850–900 per tonne.
• The surge affects both finished fertilisers and key raw materials, amplifying overall cost pressures.

Supply Chain Disruptions

• Closure of the Strait of Hormuz has restricted global shipments.
• Shutdown of facilities by QatarEnergy and Maaden due to Iranian strikes has reduced supply.
• India is now sourcing from alternative markets like Indonesia, Malaysia, Morocco, and Jordan.
• However, new suppliers must cater to multiple regions, including South America. This has increased competition for limited supplies, further pushing up prices.

Kharif Season Fertiliser Challenge in India Amid Supply Disruptions

• The upcoming kharif season, beginning with the southwest monsoon in June, faces a serious fertiliser supply challenge, particularly for urea.
• During this season:
  • Estimated kharif requirement: 19.4 million tonnes (mt)
  • Available stock (early April): ~5.5 mt
  • This indicates a significant shortfall ahead of peak sowing season.
• Dependence on Imports and Gulf Region
  • India’s annual urea consumption: 39–40 mt
    • Domestic production: 30–31 mt
    • Imports: 9–10 mt
  • Pre-war, ~40% imports came from Gulf Cooperation Council (GCC) countries.
  • Over 60% of LNG (key input for urea production) sourced from the Gulf.
  • Disruptions in the Gulf region have directly impacted both imports and domestic production.
• Impact on Domestic Production
  • Normal monthly production: ~2.5 mt
    • March output: ~1.5 mt
    • April expected: ~1.7–1.8 mt
  • Recovery to normal levels unlikely before June.
  • LNG supply disruptions have reduced production capacity.
• Logistical and Import Constraints
  • Shipment delays due to vessels being stuck near the Persian Gulf and Strait of Hormuz.
  • Deadlines for cargo loading extended due to availability and transit issues.
  • Both imports and transportation bottlenecks are worsening supply shortages.
• Relative Position of Other Fertilisers
  • Better availability for:
    • DAP (Di-Ammonium Phosphate)
    • MOP (Muriate of Potash)
    • SSP (Single Super Phosphate)
    • Complex fertilisers (NPKS-based)
  • The urea shortage remains the most critical concern.
• Outlook: Kharif vs Rabi
  • Kharif season may be managed with difficulty
  • Greater risk lies in the rabi season, where shortages could intensify

Addressing India’s Fertiliser Crisis: Alternatives and Policy Options

• India’s fertiliser use is heavily skewed toward a few key products:
  • Urea: ~55% share of total consumption (70–71 mt annually)
  • DAP (Di-Ammonium Phosphate): ~9–9.5 mt
  • NPKS Complex Fertilisers: ~14.2 mt
  • SSP (Single Super Phosphate): ~5–5.5 mt
• This dependence makes the system vulnerable to disruptions, especially in urea and DAP.
• Shift Toward Alternative Fertilisers
  • Supply shortages—especially of ammonia—may lead to substitution with other fertilisers, such as:
    • TSP (Triple Super Phosphate): High phosphorus (46%), no nitrogen
    • MAP (Mono Ammonium Phosphate): Balanced N and P content
    • SSP: Lower phosphorus but contains sulphur
  • This shift can help manage nutrient supply despite shortages.
• Proposal: Fortified Fertilisers
  • Industry stakeholders suggest:
    • Coating urea or DAP with micronutrients (zinc, iron, boron, etc.)
    • Adding secondary nutrients (sulphur, calcium, magnesium)
    • Relaxing price controls on such fortified products
  • Benefits:
    • Improved crop yields and nutrient efficiency
    • Reduced need for separate micronutrient application
    • Greater value for farmers despite higher prices
• Role of Biostimulants in Reducing Fertiliser Dependence
• Biostimulants are emerging as a sustainable alternative:
  • Derived from microbes, seaweed, and organic matter
  • Do not supply nutrients directly but enhance nutrient uptake and efficiency
• Example: Phosphate-solubilising bacteria convert locked soil phosphorus into usable forms.
• Improving Nutrient Use Efficiency
  • Fertilisers often have limited absorption by plants.
  • Biostimulants improve:
    • Nutrient availability in soil
    • Conversion into plant biomass and yield
  • Can be blended with chemical fertilisers to reduce overall consumption.

Conclusion

• The fertiliser crisis may accelerate a shift toward diversification, innovation, and efficiency, with alternatives like fortified fertilisers and biostimulants helping India reduce dependence on traditional inputs while sustaining agricultural productivity.