Urea Import Prices Plunge to $449 per Tonne in New Tender Ahead of Kharif Season

India has received a major boost on the fertilizer import front as international urea prices have dropped back to levels seen before the Iran conflict. Public sector company National Fertilizers Limited (NFL) has received bids as low as $449.3 per tonne (landed cost, including freight) in its latest tender for importing 1.7 million tonnes of urea. This is a significant decline from the $959 per tonne bids received in an earlier import tender floated by Indian Potash Limited (IPL) for 2.5 million tonnes of urea.

NFL issued the tender on May 27 for importing 1.7 million tonnes of urea. However, suppliers offered a total of 6.25 million tonnes, including 3.17 million tonnes for India’s East Coast and 3.08 million tonnes for the West Coast.

For the East Coast, Aditya Birla Global Trading submitted the lowest bid, offering to supply 500,000 tonnes at $444.90 per tonne. The highest bid for the East Coast came from Saftco, which quoted $617 per tonne for 50,000 tonnes.

Aditya Birla Global Trading also offered to supply 600,000 tonnes to the West Coast at $458.40 per tonne. However, the lowest bid for the West Coast was submitted by Ameropa, which offered 234,000 tonnes at $449.30 per tonne. Saftco again submitted the highest bid for the West Coast at $605 per tonne for 50,000 tonnes.

Before NFL’s tender, IPL had floated a tender on April 4 for importing 2.5 million tonnes of urea. That tender attracted offers for more than 5.9 million tonnes, with suppliers quoting $935 per tonne for the West Coast and $959 per tonne for the East Coast.

NFL’s tender specified that all contracted cargoes must be loaded by July 20, enabling the fertilizer to arrive in India by August and be available for use during the latter part of the kharif cropping season.

Rural Voice had first reported on June 2 that global urea prices had already declined from $935-959 per tonne to around $650 per tonne. Industry sources had indicated that weakening demand at elevated prices was putting downward pressure on the market.

According to industry sources, the latest decline in prices has been driven largely by China’s decision to resume urea exports. China had imposed restrictions on urea exports in March following the supply disruptions caused by the US-Israel-Iran conflict and the closure of the Strait of Hormuz.

India imported a record 11.17 million tonnes of urea in FY 2025-26, valued at $5.16 billion, compared with 6.91 million tonnes worth $2.38 billion in FY 2024-25.

The Union Budget for FY 2026-27 has allocated Rs 1.71 lakh crore for fertilizer subsidies. Following the Iran conflict and the resulting surge in global fertilizer and raw material prices, some analysts had warned that the actual subsidy bill could surpass Rs three lakh crore. However, with international urea prices now falling sharply, such fears appear to be easing.

India provides substantial subsidies on urea and had entered into import contracts at elevated prices to ensure adequate supplies during the current kharif season. In contrast, farmers in Brazil, Europe, Africa and most Asian countries generally purchase fertilizers at market prices. High prices in these regions dampened demand, contributing to the recent decline in global urea prices.

India imports around 10 million tonnes of urea annually. At the same time, domestic production has fallen from around 2.5 million tonnes per month to 1.7-1.8 million tonnes per month due to disruptions in gas supplies. This had raised concerns about urea availability for both the kharif and upcoming rabi seasons, prompting the government to secure imports even at elevated prices.

The Department of Agriculture and Farmers Welfare had initially projected fertilizer consumption during the kharif season at 39.05 million tonnes, later revising the estimate downward to 38.39 million tonnes. The government stated on Monday that more than 2.5 million tonnes of imported urea, DAP and NPK fertilizers are expected to arrive at Indian ports during June.