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Thursday, September 20, 2007

Fertiliser scarcity may nip Rabi crop

NEW DELHI: In a fresh blow to food security, there may be an impending shortage of fertilisers in the coming rabi season if India is unable to immediately buy close to 10 lakh tonnes (LT) more from the world market.

The biggest crisis is expected in di-ammonium phosphate (DAP), where India has become highly dependent on foreign manufacturers.
A worried government is now planning to itself import an extra 6 LT urea and 1 LT DAP, and give the highest priority to ships carrying fertilisers at all important ports till November, when the critical sowing period starts. Six crops — rice, wheat, cotton, sugarcane, rapeseed and mustard — use more than two-thirds of the total fertiliser supply in the country.

India needs almost 41 LT DAP in the coming rabi season for which it is necessary to ensure a supply of at least 43 LT. Since the likelihood of sufficient supply of DAP is remote, the department of fertilisers has sought permission from the Cabinet to import substitutes such as mono-ammonium phosphate (MAP) and triple super phosphate (TSP).

State trading agencies have been authorised to start importing MAP to make up the shortfall in DAP. Indian Potash (IPL) has already bought 1.65 LT MAP overseas and is ready to contract more once the Cabinet gives its go-ahead.

Government estimates say in addition to the imports already contracted by private companies and IPL, India will need to source at least 1.12 LT DAP/MAP to maintain adequate supply of phosphatic fertilisers.

However, shifting to MAP would not be easy. “Before MAP can be marketed directly to farmers, the issue of subsidy, MRP, etc, will have to be resolved. A Cabinet note on the issue has been prepared separately by the department of fertilisers. In the meantime, the steering committee of secretaries is requested to authorise additional imports of 1.5 LT of DAP/MAP,” the department said.

In the case of urea, the farmers’ favourite, India needs to import 32.17 LT for the rabi reason. This does not include imports from Oman India Fertiliser Co (Omfico). The steering committee of secretaries has already permitted imports of 20 LT. Since the actual demand estimate for urea is still not final and the country has a buffer stock of 6.25 LT, the department of fertilisers believes further import of 6 LT may be sufficient for the season.

The demand for muriate of potash (MoP) is likely to cross 16 LT this rabi. As India is totally dependent on foreign companies for MoP, it will need to import at least 15 LT this winter. The import is expected to made entirely by private companies.

Most of the imported fertiliser will start arriving at ports from next month. The department of shipping had given priority berthing to fertiliser cargoes up to September. But with the anticipated rush at ports, the department of fertiliser is demanding the priority status be extended till November-end. While this will allow rapid transportation and delivery of fertilisers across the country, it may play havoc with imported wheat cargoes.

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