Escalating tensions in West Asia have begun to hit Indian farmers directly, as a sharp rise in global fertilizer prices and disruptions in imports have led fertilizer companies to increase the prices of several complex fertilizers under the nutrient-based subsidy (NBS) regime. Prices of some NPK fertilizer variants have now reached between Rs 2,250 and Rs 2,450 per 50-kg bag.
According to fertilizer industry sources, a major fertilizer company has offered NPK grades 12:32:16 and 10:26:26 to Cooperative marketing federations at prices of up to Rs 2,450 per bag. Companies argue that without additional government subsidy, selling below these levels would result in significant losses due to soaring raw material costs and the subsidy rates announced for the Kharif 2026 season.
While politically sensitive urea prices remain fully controlled by the government, and di-ammonium phosphate (DAP) continues to be indirectly capped at Rs 1,350 per bag through additional subsidy support, companies have started raising prices of other subsidized fertilizers to offset rising production costs. Industry executives point out that some NPK fertilizers are now being sold at prices significantly higher than DAP despite containing lower nutrient levels.
Raw Material Shortages Hit Production
Industry sources said shortages of ammonia, sulfur, and sulfuric acid are affecting domestic production of complex fertilizers. Several plants are unable to operate at full capacity because of inadequate availability of raw materials. In contrast, most urea plants in the country are currently operating at near full capacity.
India consumes around 140 lakh tonnes of complex fertilizers annually, compared to nearly 400 lakh tonnes of urea and about 100 lakh tonnes of DAP.
Among the most widely used NPK variants, 20:20:0:13, which has annual sales of nearly 50 lakh tonnes, has witnessed significant price increases. Gujarat State Fertilizers and Chemicals (GSFC) has revised its price to Rs 2,250 per bag. Paradeep Phosphates Ltd. (PPL) has fixed prices at Rs 1,850 per bag in Karnataka and Rs 1,800 in Telangana.
FACT has priced the same grade at Rs 2,100 per bag in Karnataka, Kerala, Andhra Pradesh, and Telangana, while in Tamil Nadu it is selling at Rs 1,800 per bag. SPIC is offering the fertilizer at Rs 1,800 per bag in Tamil Nadu, Andhra Pradesh, and Telangana. MCF is selling it at Rs 2,100 per bag in Tamil Nadu, while CIL has fixed prices at Rs 1,800 per bag in Andhra Pradesh and Telangana.
A senior officer of a leading fertilizer company told Rural Voice that companies are revising prices strictly on the basis of production costs. According to the executive, the production cost of the widely consumed 20:20:0:13 grade has already touched nearly Rs 2,400 per bag, making further price increases inevitable.
Massive Import Bill Looms
The Centre has recently approved a tender for importing 25 lakh tonnes of urea at prices of $959 per tonne for the eastern coast and $935 per tonne for the western coast.
At the same time, a consortium of government and cooperative fertilizer companies has finalized a tender for importing around 13 lakh tonnes of DAP. The agreed prices are $935 per tonne for the eastern coast and $930 per tonne for the western coast.
Industry observers say these elevated import prices will sharply increase the government’s fertilizer subsidy burden in the coming months.
The government is currently prioritizing the availability of urea and DAP by focusing on LNG procurement and imports of finished fertilizers. To maintain DAP prices at Rs 1,350 per bag, the Centre continues to provide additional subsidy under the NBS scheme. However, no similar support has been extended for other complex fertilizers.
States Tighten Fertilizer Sales Norms
Several states have tightened fertilizer distribution rules amid rising demand and concerns over availability during the Kharif season. In many districts, farmers are reportedly being allowed to purchase only two or three bags of urea or DAP against a single Aadhaar card.
Authorities have made land ownership mandatory for fertilizer purchases, and farmers are required to visit sales centers personally for biometric authentication. Fertilizer dealers must submit daily sales records to district administrations, while every sale is uploaded in real time to the Union Fertilizer Ministry’s monitoring portal.
A fertilizer dealer in Saharanpur district of Uttar Pradesh said the restriction of two bags per transaction has forced farmers to make repeated visits to purchase fertilizers. He added that due to the high prices of complex fertilizers, farmers are increasingly preferring DAP over NPK products.
Government Working on Consumption Reduction Plan
The Centre is also finalizing a broader action plan aimed at reducing the consumption of chemical fertilizers. The issue was discussed in a meeting chaired by Prime Minister Narendra Modi on Thursday, followed by further deliberations among officials on Friday.
The proposed strategy is expected to focus on reducing dependence on chemical fertilizers and promoting balanced nutrient use. However, with the Kharif season already underway, industry experts caution that any disruption in timely fertilizer availability could adversely affect crop production.