In support of the government’s stance on adequate availability of di-ammonium phosphate (DAP) during the ongoing rabi sowing season, the Fertilizer Association of India (FAI) has emphasized the need for a balanced pricing approach.
The association believes this will not only curb artificial demand but also address the critical issue of soil health degradation.
FAI Highlights Pricing Concerns
Fertilizer Association of India’s Chairman N Suresh Krishnan raised concerns about the current pricing of DAP.
He pointed out that the maximum retail price (MRP) of DAP, set at ₹1,350 per 50-kg bag, has led to artificial demand.
“The challenge lies in pricing. If DAP were priced appropriately, this artificial demand might not have occurred,” Krishnan stated.
Comparative Fertilizer Pricing
Government data reveals a disparity in the pricing of different fertilizers.
While the MRP of muriate of potash (MOP) ranges from ₹1,500 to ₹1,550 per 50-kg bag and complex fertilizers range from ₹1,230 to ₹1,700 per bag, urea is priced significantly lower at ₹267 per 45-kg bag – a rate unchanged for over a decade.
Global trends indicate that while the price of imported urea has dropped 8.44% to $369 per tonne (FOB) in October compared to $403 a year ago, and MOP prices fell 11.29% to $283 per tonne (CFR), the price of DAP rose by 7.9% to $642 per tonne.
Government Intervention Ensures Stable Pricing
Despite the global price fluctuations, the government has ensured stable DAP prices for farmers by absorbing subsidies above a benchmark rate.
Krishnan acknowledged this proactive policy, adding that the government remains committed to shielding farmers from disadvantageous price hikes caused by geopolitical uncertainties.
“Global DAP prices have seen extreme volatility, crossing $1,000 per tonne in the past. However, they now hover around $630–$640 per tonne,” Krishnan explained.
Advocating for Premium Pricing
Industry officials argue that as a premium product, DAP should command premium pricing. Currently, the government provides a subsidy of ₹1,225 per bag to stabilize prices. However, they suggested that MRPs may need to be revised if global prices rise further.
Promoting Balanced Fertilizer Usage
Krishnan also highlighted a shift toward greater use of complex fertilizers, which contain balanced proportions of nitrogen (N), phosphorus (P), and potassium (K). This trend, he noted, is beneficial for both soil health and crop yield.
“The increased use of complex fertilizers is a positive sign. Balanced fertilizer application supports healthier soil and better crops,” he said.
No Impact on Yields from Reduced DAP Use
Addressing concerns about yield impacts from reduced DAP application, Krishnan assured that the higher usage of complex fertilizers compensates. It compensates effectively.
“Yields are not negatively impacted. In fact, balanced fertilization is advantageous for crops,” he concluded.
As reported by thehindubusinessline.com, the Fertilizer Association continues to advocate for pricing strategies and usage patterns. These efforts aim to ensure sustainable farming practices, improve soil health, and provide stable benefits for farmers.
