Fertiliser Uncertainties

This is going to be a testing year for Indian agriculture. Not because of any bad monsoon: On the contrary, most States — barring Orissa, Assam and parts of Maharashtra — have so far received good and timely rains. The pressure point could, instead, be fertilisers. A 50-kg bag of di-ammonium phosphate (DAP) that used to cost Rs 467.50 before April 2010 — when prices of all non-urea fertilisers were decontrolled — is now worth Rs 600, with some firms even charging Rs 700. Farmgate prices of muriate of potash (MOP) have similarly gone up from Rs 222.75 to Rs 315 a bag and are slated to rise further to Rs 425 from next month (all these rates are net of local taxes). Urea prices, which are still controlled by the Government, have not increased as much, moving up from Rs 241.50 to Rs 268.23 a bag. But with a Group of Ministers giving the go-ahead for bringing urea too under the nutrient-based subsidy regime, farmers may soon have to pay more for this input as well.

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