Russian sellers said to stop fertiliser discounts to India

Subject :Economy

Section: External Sector

Context:

Russian companies have ceased offering fertilizers such as di-ammonium phosphate (DAP) to India at discounted prices due to tightening global supplies after becoming the biggest suppliers to the country last year.

Details:

India’s fertilizer imports from Russia surged 246% to a record 4.35 million metric tons in the 2022/23 as suppliers give discounts (10%) to the global market price for DAP, urea and NPK fertilizers.
Discounts provided by Russia led to decline in import of fertilizers from other countries like China, Egypt, Jordan, and the United Arab Emirates.
Current urea price: approximately $300 per ton on a CFR basis.
Russia is the world’s biggest exporter of fertilizer, followed by Canada, China, Belarus, and the United States.
Brazil is the top importer of fertilizers.
India imports most of its Fertilizer from China, United Arab Emirates and Spain and is the 3rd largest importer of Fertilizer in the World.

Impact of the decision:

Di-Ammonium Phosphate (DAP):

Urea and DAP are two largely consumed fertilizers in the country.
Diammonium phosphate (DAP) is the world’s most widely used phosphorus fertilizer.
DAP fertilizer is an excellent source of Phosphorus and nitrogen (N) for plant nutrition.
It’s highly soluble and thus dissolves quickly in soil to release plant-available phosphate and ammonium.
A notable property of DAP is the alkaline pH that develops around the dissolving granule.
Being a basic nutrient for Rabi crops, the DAP fertiliser has to be sprinkled at the time of sowing crops like mustard and wheat.
Any delay in its supply could adversely impact the sowing of crops.