Fertiliser companies raise DAP, NPK rates on spike in input costs

IFFCO hikes DAP prices by 12.5%; existing stock will continue to be sold at old rates

With input costs rising sharply, fertiliser companies have started passing on a portion of the same to the farmers.

Sources said fertiliser major IFFCO has raised the price of DAP from Rs 1,200 a bag to almost Rs 1,350 per 50 kg bag (an increase of 12.5 per cent), while that of one variety of NPKS has been raised to Rs 1,400 per 50 kg bag from the earlier Rs 1,290 per bag (an increase of 8.5 per cent).

For NPK-1 and 2, which are other grades of NPK fertiliser, the price hike has been a nominal Rs 20 per bag to Rs 1470 per bag. The existing stock will continue to be sold at the old rates. IFFCO is one of the biggest producers of DAP and also a significant player in the overall non-urea fertilizer space.

Other private companies, sources said, are also looking to either increase their retail rates of non-urea fertilizer or have already done so.

Trade and market sources said that NPK in its various grades and compositions is one of the most commonly consumed fertilizer in the western and southern part of the country during the kharif

In NPK, the price varies depending upon the grade and the proportion of main raw material which is nitrogen, phosphorus, potassium and sulphur is used in making the fertilizer. There are almost 15-20 grades of NPK.

Industry sources, meanwhile, said that a final picture on the actual retail price of a 50-kilogram bag of NPK will depend on the quantum of subsidy as mandated by the nutrient-based subsidy regime notified by the Central government for 2022-22.

“The subsidy notification is expected to be announced anytime soon,” a senior industry official said.

Ever since the Russia-Ukraine crisis, not only the price of finished DAP, NPKS and Muriate of Potash (MOP) has risen sharply, but the raw materials that go into their manufacturing has also jumped.

India imports almost all of its MOP requirements, while the import component in DAP is around half of the annual consumption.

In case of NPK, the country domestically produces around 80 per cent of the annual requirement while in case of urea a third of its annual demand needs to be imported.

Since late February, landed price of finished DAP in India has gone up from around $900 per tonne to almost $1050-$1100 per tonne, an increase of 17-22 per cent.

Landed price of phosphoric acid, which is fixed on a quarterly basis, was pegged at $1530 per tonne for the January to March quarter, up from $1330 per tonne for the quarter before that, an increase of almost 15 per cent.

MOP prices which have been imported into India under contract till November 2021 at around $280 per tonne, after the conflict the same has now jumped to almost $500 per tonne (a rise of 78.57 per cent).

Ammonia prices which were being quoted at around $900 per tonne before the conflict have jumped to almost $1050-$1100 per tonne (for the middle east origin ones). This is the highest ever Ammonia prices quoted since 1995 Sulphur, prices of which closely mirrors global Brent crude, was selling at around $300 per tonne before the conflict and is now selling at around $450-500 per tonne (a rise of over 50 per cent).