The West Asia war may disrupt India’s fertiliser output and supplies in a month, officials said. “For the next month, we are comfortable in terms of supplies as we are in a lean period. But if the conflict continues, it would impact our fertiliser production capability,” an official with a major manufacturer told FE.
The period of March-April is considered a lean period for fertiliser demand, while demand is likely to peak by mid-May, just before the onset of the monsoon in June for the kharif season. “Comfortable fertiliser stocks are likely until peak kharif demand starting May 15,” the official stated.
Currently, urea stock is around 6.2 million tonnes (MT), at least one MT higher than the previous year. Fertiliser companies have placed an order for 1.35 MT of urea import, expected to arrive by the end of March. The current stock of 2.5 MT of diammonium phosphate (DAP) is double that of the previous year while companies have 5.6 MT of nitrogen, phosphorus and potassium (NPK), which is the highest ever against 3.1 MT last year.
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Buffer Stocks
For the 2025 kharif season, the government projected the requirement of soil nutrients as 18.53 MT of urea, 5.69 MT of DAP, 1.11 MT of muriate of potash, and 7.61 MT of NPK.
The Department of Fertiliser is currently monitoring an unusual spike in soil nutrient sales across 650 districts to curb panic buying.
Urea production is likely to decline to 1.7 MT this month due to annual shutdowns in some plants, while average monthly urea production is around 2.5 MT, according to an official.
To boost LNG supplies, a key feedstock for urea production, the state-owned GAIL will buy gas from the spot market from countries such as Australia, Russia and the United States starting March 17.
Currently around 10% to 15% of LNG is purchased from the spot market while the rest is sourced under long term contracts with Qatar and United Arab Emirates. The official said that the blockade of the Strait of Hormuz, a key import route from the Gulf countries, has caused concern about LNG supply constraints.
“All our partners have assured us of uninterrupted supplies and we hope to attain and maintain comfortable fertiliser stocks by the time kharif demand peaks by May 15,” an official said in a briefing. In terms of global supplies, Saudi Arabia’s long-term contract with India to supply 3.1 MT of DAP annually for five years remains intact while Russia and Morocco continue to supply urea and DAP via the Cape of Good Hope, South Africa.
Currently, 50% of LNG used in domestic urea manufacturing is imported from Qatar, under a long-term agreement. About 80% of urea production in the country uses LNG while the rest uses domestic gas. At present, 30 out of 32 urea units use natural gas as feedstock.
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Feedstock Security
The Fertiliser Association of India (FAI) stated that the current disruption has impacted gas supplies, a feedstock, and it is working closely with the Government to prioritize gas allocation for urea production. Last week the government invoked the Essential Commodities Act for the first time to ensure the supply of natural gas, a key raw material, to fertilizer plants.
The order stated that the government shall ensure the supply of natural gas to fertiliser plants at 70% of their past six-month average gas consumption, subject to operational availability.
The annual consumption of fertilizers in the country is around 64-65 MT, out of which urea accounts for 40 MT while DAP consumption is around 11 MT. Rest of the consumption is potash (2-3 MT) and complex fertilizers (10 – 11 MT).
TOPICSFertilisersThis article was first uploaded on March fifteen, twenty twenty-six, at thirty-six minutes past six in the evening.