As DAP sales dip, farmers turn to more beneficial NPKS, shows data

MOP sales buck trend, rise 20% in kharif 2024

The perceived shortage of Di-Ammonium Phosphate (DAP) just before the critical rabi sowing season might have had an unintended benefit.

 

Sales of the more beneficial NPKS complex fertilisers have spiked year-on-year (Y-o-Y) during the April–October period, as farmers replenished their soils. Sales of Muriate of Potash (MOP) also rebounded, bucking a declining trend seen over the past two financial years.

 

This could also suggest that the drop in DAP sales might not adversely impact rabi crop yields, according to officials from the Fertiliser Association of India (FAI).

 

Data by FAI showed that NPKS sales between April and October increased almost 23.5 per cent Y-o-Y, while DAP sales dropped 25.4 per cent during the same period. The most common grade of NPKS — 20:20:0:13 — recorded the highest growth in sales, industry players said.

 

Between DAP and NPKS, the latter is considered a better soil nutrient due to its balanced quantities of nitrogen (N), phosphorus (P), potash (K), and sulphur (S). In contrast, DAP, according to some industry players, contains almost 46 per cent phosphorus, NPKS 20:20:0:13 has equal amounts of critical nutrients. 

 

Some farmers, however, complained that the lower availability of DAP has pushed up their production costs as more quantities of NPKS are needed to compensate for the loss of phosphorus.

 

“This shift is good for the long run, and if the trend (of farmers using more NPKS) continues, it would be good for the soil,” FAI Chairman N Suresh Krishnan told reporters here.

 

The sales of DAP went down in the April-October period of FY25, as imports dropped by almost 30 per cent to 2.78 million tonnes (mt) Y-o-Y.

 

“Imports were less as ships were taking longer to reach due to the crisis in the Persian Gulf, which is why prices also went up to around $632 per tonne in September. Ships that usually used to take 20-25 days to reach India now took almost 45-45 days,” another senior official claimed.

 

Industry sources had earlier cited inadequate subsidy provisions in the first half of FY25 as a reason for low imports as companies faced losses when importing DAP. However, in October 2024 when the Centre addressed the issue by offering an additional Rs 3,500 per tonne subsidy for DAP to cover costs from port or factory gate to farm gate, effective from April to December for this year.

 

“This has now become a permanent feature where the government has assured us that it will compensate for the actual difference between the landed price and subsidy of imported DAP,” another industry official said.

 

India imports around 80 per cent of its annual DAP consumption, which is estimated at 10–11 mt, making it the second-most consumed crop nutrient after urea.

 

Meanwhile, data also showed that consumption of potassium, which declined sharply in FY22 and FY23 due to high price as compared to DAP further deteriorating the NPKS mix, seems to have normalized, with MOP sales registering 9.5 per cent growth in FY24 at 1.88 mt. However, this was still lower by almost 40.4 per cent than the 2020-21 levels.

 

The trend seemed to have continued during kharif 2024 as consumption of MOP has risen over by 20 per cent Y-o-Y.

 

MOP retail prices had surged in FY22 and FY23 as the Russia–Ukraine war squeezed global potash markets. The two countries, along with ally Belarus, are major producers of potash.

 

Better soil nutrient use has helped enhance the NPK ratio in Indian soils, which improved to 9.8:3.7:1 in kharif 2024, compared to 10.9:4.9:1 in kharif 2023. The ideal NPK ratio for Indian soils is 4:2:1, according to FAI.

 

Meanwhile, FAI said there was no shortage of DAP despite a fall in imports and production in the first seven months of this financial year.

 

It said DAP should command the highest price among all non-urea fertilisers because of its high nutritional value. There could be a fall in the closing stock of DAP at the end of the current financial year, sales have improved dramatically in November as sowing progressed, the FAI said.