The government’s fertilizer subsidy bill may exceed ₹2-lakh crore in current fiscal as it has crossed 70 per cent of the Budget allocation of ₹1.75-lakh crore in the last seven months. But with rising subsidy level, the retail prices of non-urea fertilizers are likely to remain stable as the government has assured to take the burden.
“We had never allowed fertilizer shortages nor will allow ever. Globally, fertilizer prices rose everywhere but we did not allow it to rise in India,” Information Broadcasting minister Anurag Singh Thakur said on Wednesday.
According to latest data, the total fertilizer subsidy during April-October was ₹1,22,975.63 crore,of which ₹79,660.35 crore was spent on urea and ₹43,315.28 crore on phosphorus (P) and potash (K).
Of the total Budget allocation of ₹44,000 crore for P and K subsidy, 98.4 per cent has been exhausted until October. The government has allocated ₹22,303 crore subsidy during the current Rabi season (October-March) for P and K fertilisers.
The requirement of urea in current rabi season has been estimated at 185.41 lakh tonnes (lt), that of DAP at 54.99 lt, MoP at 12.60 lt, complex at 63.60 lt and SSP at 31.24 lt. However, as sales of fertilizers in October increased by 9 per cent, there is an apprehension that overall fertilizer usage will also be higher in this season from last year.
Sales surge
According to official data, overall sales of four key group of fertilisers — urea, DAP, MOP and complex (a combination of N, P, K and S nutrients) — have surged to 368.57 lt during April-October 2023 from 327.28 lt year-ago, up by 12.6 per cent.
The cumulative availability (including carryover stock from kharif season) in current rabi season (October-March) as on October 30 was 78.07 lt of urea, 30.24 lt DAP, 6.83 lt MoP, 42.33 lt complex and 19.85 lt of single super phosphate (SSP).
In 2022-23, the country’s fertilizer subsidy reached a record ₹2.25-lakh crore after a global price surge. Prices have fallen from those highs. Imported urea has fallen to about $360/tonne (FOB) from about $665 in October 2022, that of DAP to $595/tonne (CFR) from $722 a year-ago and MoP to $319/tonne from $590 a year-ago.
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