There is a lot at stake for Indian fertiliser companies in the ongoing political upheavals in Egypt, Tunisia and Jordan. All the three Arab countries are major suppliers, particularly of phosphatic fertilisers and their intermediates.

India annually imports about 55 lakh tonnes (lt) of rock phosphate, the main raw material for phosphoric acid – that is further processed into di-ammonium phosphate (DAP) or single super phosphate (SSP).

Of the 55 lt, valued at around $900 million, Jordan alone accounts for 25 lt, with Egypt following at 10 lt.

The Egyptian rock is of low grade (28-29 per cent phosphorous content) and is largely imported by SSP manufacturers. This is against the 32 per cent content material from Jordan and Morocco or the highest-grade 36 per cent of Togo and Senegal, which are better suited for DAP, industry sources noted.

Besides rock phosphate, Jordan and Egypt are also important sources of finished fertilisers. Of the 80 lt of DAP that India is expected to import this fiscal, Jordan's share would be 15 lt, which is next to only the US' 30 lt. Egypt is a supplier to the tune of five lt each of both DAP and urea.

Tunisia, on its part, is the country's second largest source of phosphoric acid (4 lt of the total 30 lt), behind Morocco (14 lt). It also exports roughly one lt of DAP.

The political situation in the region is a cause for concern, more so given the strategic location of the Suez Canal. While DAP from the US can be rerouted through the Cape of Good Hope, the shipments from Egypt, Tunisia, Jordan and Morocco can only go via this waterway connecting the Mediterranean to the Red Sea, the sources pointed out.

In addition to imports, Indian firms have ongoing investments in joint ventures for manufacture of phosphoric acid in Jordan and Tunisia.

Coromandel International and Gujarat State Fertilisers & Chemicals hold 15 per cent each in Tunisian Indian Fertilisers SA, whose 3.60-lt phosphoric acid plant is due for commissioning in the next couple of months. There is also the 4.65-lt Jordan India Fertiliser Company project – where the Indian Farmers Fertiliser Cooperative has 52 per cent stake – that is slated to come up by early-2013.

There are no problems immediately, since most of the imports for this fiscal have already been contracted and arrived. But if things do not stabilise soon, it could impact imports and even fertiliser supplies for the ensuing kharif season. The Government should be alive to this possibility and use its diplomatic channels if necessary, considering the food security implications involved, the sources added.

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