India fertilizer sales up by 25pc in kharif

Date:10-09-2020

Total sales of fertilizers — urea, DAP, NPKs, MOP and SSP — rose to 33.7mn t in kharif (see chart), latest provisional data show, from 27mn t a year earlier.

Sales of urea, the most widely consumed fertilizer in India, were up by 16pc on the previous season to 17.78mn t. September sales slipped to 2.26mn t, down from 2.9mn t in the month last year.

Increased offtake of DAP and NPKs drove the rise, with overall DAP sales up by 51pc this kharif season to 5.4mn t. September DAP sales stayed strong, hitting 765,000t, compared with 633,000t a year earlier.

NPK offtake increased to 6.5mn t in April-September, up by 40pc on a year earlier. September sales were broadly flat on a year earlier at 1.1mn t.

Meanwhile, total MOP sales were up by over a third to 1.6mn t in kharif, from 1.18mn t a year earlier. September sales rose to 324,000t, up from 278,000t a year earlier.

SSP sales posted a comparatively modest rise of 8.4pc in kharif to 2.42mn t, with sales last month slipping to 263,000t, from 326,000t a year prior.

Record crops and solid rainfall drive sales boom

Increased crop acreage sown in April-September has fuelled the increased buying in India this year.

Sown acreage was up by 4.8pc for this summer's kharif crop on last year's levels to 111.69mn hectares, according to the agricultural ministry's latest estimates at the end of last week.

The increase in sown acreage has led to projections of record grains production, including a record rice crop, this summer season. Rice output will hit 102.36mn t, up from 101.98mn t produced in kharif a year ago. This is up from the record 2018-19 kharif harvest of 102.04mn t, according to the ministry's first seasonal forecast.

Solid rainfall this monsoon season has been crucial to the rise in sown acreage and the according record crop production in kharif. Countrywide rainfall in the monsoon season, typically running from June to September, averaged 957.6mm, up by 9pc on the long-term mean. The increased rainfall lifts reservoir levels and encourages farmer sowing and fertilizer purchases. Reservoirs were up to 86pc filled, in capacity terms, on 24 September, compared to the 10-year average of 75pc, and broadly in line with levels at that point last year.

The increased domestic fertilizer offtake has unsurprisingly fuelled a jump in sales by Indian suppliers, with the country's second-largest distributor NFL posting record fertilizer sales for the April-August period.