Agri Business

Farmers demand augmented supply of urea with rabi sowing period set to end

Prabhudutta Mishra | | | Updated on: Dec 03, 2021
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Both industry and government officials maintain that there is no shortage of urea

Farmers in some parts of the country are demanding augmented supply of urea, as the main rabi sowing period is set to end in a month. However, the government is confident of managing the supplies and hopefully, no farmer faces problems like what was seen when di-ammonium phosphate (DAP) demand surged last month.

Both industry and government officials maintain that there is no shortage of urea. The Centre has been supplying fertiliser to the States without any delay based on the requirement indicated by them, Union Fertiliser Minister Mansukh Mandaviya had said November 23 at a review meeting with States. “The Centre is working relentlessly to meet the urea requirement of the country in the rabi season,” he had said.

According to Urvarak portal data, total requirement of urea for the rabi season was 17.9 million tonnes (mt) whereas demand during October-November was pegged at 7.7 mt. This means in the remaining period of the season the country should have 10.2 mt of urea demand. However, due to lower sales at 5.2 mt during this period, there could be about 12.7 mt of urea required until March 31. For the fertiliser demand-supply estimates, rabi season is from October to March.

Drop in sales

Since the government data show the availability of urea was to the tune of 9.3 mt during October-November, why the sales were down? Was it due to an inflated demand estimates by the States or error in availability calculation by the Centre?

While some States claim that their demand assessment for the season is a real requirement as they have factored in the carry over stock also. But the Centre believes that the demand estimates, taken much earlier are for the entire season and carry over stocks need to be added with the fresh supplies.

The sales of urea in Madhya Pradesh was 0.8 mt in October-November against demand estimated at 1.3 mt as there was lower availability than what has been shown on the portal (1 mt), said farmer leader Kedar Sirohi. For December demand, the State government has simply failed to assess the situation in the light of 9 per cent increase in sowing areas under gram (chana), 6 per cent in wheat and 62 per cent in mustard, so far, Sirohi said. Current stock position of urea is 0.22 mt in the State.

“There were protests on November 30 in 30 districts, including the home district of State agriculture minister on shortages of urea. The government has failed to even distribute it properly whatever quantity available as per the sowing pattern,” said Sirohi.

“There is no truth in the allegation that there is a scarcity of fertiliser in the State. We have made rationing of fertiliser based on land size of farmers to achieve reduction in consumption of chemical fertilisers as envisioned by prime minister Narendra Modi,” said Kamal Patel, agriculture minister of Madhya Pradesh. He termed the current “noise over shortages” as those by traders who were earlier profiteering through black-marketing.

Patel also said that to reduce the long queues before retail outlets, the State on Tuesday directed cooperatives to sell fertilisers on payment basis to defaulting (of loans) farmers, who were earlier asked to source from a designated centre. As high as 70 per cent of fertilisers are sold through cooperatives and 30 per cent by traders in Madhya Pradesh.

Rajasthan, too, has estimated about 0.8 mt of urea demand for October and November after deducting the carryover stocks of about 0.28 mt. It received a fresh supply of 0.59 mt of urea in these two months. For December, the State’s requirement of urea is 0.5 mt whereas the Centre has allocated 0.35 mt.

“We are now getting 2-3 rakes daily whereas the need is for 4 rakes per day as sowing will be over by December 10 and farmers will keep demanding for urea,” said an official of the State government.

Haryana has received about 0.4 mt of urea during October-November against the demand of about 0.5 mt in these two months. Since farmers have started first irrigation at some places, they need urea now and the demand will further go up, officials said. Some districts like Hisar, Bhiwani have reportedly lower availability of urea.

“By December 15, Haryana will need 0.3 mt of urea to meet the month’s demand whereas the stock position as on November 29 was about 0.1 mt,” a source said adding the State government has been monitoring supply situation at district levels to prevent any black-marketing.

Sales in Punjab

In Punjab, where wheat sowing has been completed in 84 per cent of the targeted 35 lakh hectare, urea sales were reported to be 0.48 mt in first two months of the season against a demand of 0.8 mt, the requirement in December is expected to be high at 0.5 mt. Currently, the State is receiving 20,000-25,000 tonnes of urea daily and is hopeful of meeting any surge in demand as the stock position is also comfortable at 0.36 mt.

Industry officials denied any kind of shortages as there is no fall in domestic production rather some companies have been producing more than their capacities. “It is more of a crisis due to bad management of distribution by States,” said an industry official requesting not to be named.

The fertiliser ministry last month approved import of about 1.6 mt of urea, estimated to cost $1.5 billion (nearly ₹11,500 crore) to be brought in by Indian Potash (IPL) on government account to help improve domestic supplies. The urgency of the import can be gauged from the fact that the approval for the contracts came in just 14 days after IPL was allowed to buy on behalf of the government on November 3.

Out of total import, about 1 mt will arrive at ports on western coast while 0.6 mt will be on eastern coast by December-end, a fertiliser ministry official had said.

Published on December 03, 2021

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