Fertilizer Markets and Finance

NEW DELHI: The consumption of key fertiliser potashby Indian farmers has fallen by 23 per cent to 29.90 lakh tonne, mainly due to high global prices of the crop nutrient forcing them to go for urea, a cheaper alternative.

The price of potash had risen by 30 per cent to an average of USD 468 per tonne in 2011-12 fiscal. India, one of the world’s largest consumers of muriate of potash (MoP), imports 100 per cent of the crop nutrient to meet domestic requirements.

The country consumed 38.90 lakh tonne of MoP in 2010-11, while its average global price was USD 361 per tonne (excluding ocean freight) in the same period, as per the data provided by Minister of State for Chemicals and Fertilisers Srikant Jena to the Lok Sabha.

The falling demand is also reflected in the declining imports of the crop nutrient, which registered a drop of 40 per cent to 26.93 lakh tonnes in the 2011-12 fiscal from 45 lakh tonnes in the 2010-11 fiscal, the data added.

The minister had in a written reply said that effect of rising prices of fertilisers on agriculture is yet to be analysed.

“However, it is observed that consumption of phosphatic and potassic (P&K) fertilisers has come down while that of urea has increased,” he had said.

Industry analysts attribute the rising consumption of urea and the falling demand of MoP to their domestic prices.

While the domestic price of MoP is in the range of Rs 11,300-12,000 per tonne, the prices of urea is Rs 5,310 per tonne.

Read more at The Economic Times