Urea Subsidy

The fall in global fertiliser and natural gas prices are likely to bring respite to fertiliser companies. But Russian export duty on fertiliser may have a trickle-down impact on the Indian industry

Shares of Coromandel International, Deepak Fertilisers, GSFC, Madras Fertilisers, National Fertilisers, RCF, and Zuari Agro Chemicals have soared up to 196 per cent so far this calendar year (CY22)

At present, the capacity of Nano urea is 50 million bottles per year

Union Chemicals and Fertilisers Minister Mansukh Mandaviya on Tuesday said there is no shortage of crop nutrients in the country and asserted that there will be no hike in the prices of non-urea products. The minister also said that Nutrient Based Policy (NBS) for Phosphatic and Potassic (P&K) fertilisers for the Rabi season (October 2022 to March 2023) will be announced shortly. "There is no shortage of fertilisers in the country," Mandaviya told reporters on the sidelines of the International Dairy Federation (IDF) World Dairy Summit here. He was responding to a query about the supply situation for the upcoming Rabi sowing season that would start from October. On when the government would announce the NBS policy for P&K fertilisers for the Rabi season, he said it will be done shortly after analysing international prices. "We will not allow any increase in retail prices of DAP (Di-ammonium Phosphate) and other non-urea fertilisers," Mandaviya said, adding that the government

The commissioning of new plants is expected to bring down import dependency to less than half of current levels

The government will not increase retail prices of urea and also provide adequate subsidies to ensure that the maximum retail prices of non-urea fertilisers remain at the present level, sources said

Sources said a cumulative impact of Rs 5,600 crore could be released to the fertilizer companies as result of the Cabinet decision

The proposed move seeks to promote balance between chemical and organic fertilisers

As of now, the proposal on the table is to consider direct benefit transfer to farmers for food and fertilizer subsidies, sources said

Supplies to farmers in Madhya Pradesh accounted for just half the requirement of 400,000 bags of urea this November, even as mounting inventories incurred losses for companies

The government is seriously considering options for decontrolling urea by either fixing a nutrient-based subsidy(NBS) rate or making direct payment of subsidy to farmers' account, Fertiliser Minister Sadananda Gowda said on Wednesday. In 2010, the government had launched the NBS programme under which a fixed amount of subsidy, decided on an annual basis, is provided on each grade of subsidised phosphatic and potassic (P&K) fertilizers, except for urea, based on the nutrient content present in them. "As far as change in the urea policy is concerned, we are open to suggestions. It can be NBS for urea or direct subsidy to the farmers account with decontrol of fertilizer sector. These are some of the alternatives which are under discussion," Gowda said while addressing an event organised by the Fertiliser Association of India (FAI) here. He further said that the government is "actively pursuing the issue of revision of fixed cost under urea policy" and added that any change in policy

A decision in this regard was taken at the meeting of the Cabinet Committee on Economic Affairs (CCEA) headed by Prime Minister Narendra Modi

The Union Cabinet is expected to consider a change in the New Urea Policy of 2015, to enable disbursal of higher subsidy to companies which perform better, based on the import parity price (IPP). A panel of ministers at a meeting scheduled for Friday is also expected to approve unrestricted export of all certified organic agricultural products.On urea, officials said the import parity price is calculated on the basis of the landed price. Incidentals like customs and port loading and handling charges are not included. This sometimes leads to less disbursal of subsidy to fertiliser companies, when the landed price falls sharply in international markets. This is because the subsidy is capped up to the IPP.If customs duty and port handling charges, estimated to be 5.65 per cent, are added to the landed price on any day for the purpose of subsidy calculation, it will lead to higher outgo for companies. The subsidy for urea is calculated on the basis of variable cost (mainly gas prices), ...