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Indian potash import prices surge 21%

17th October 2018

By: Ajoy K Das

Creamer Media Correspondent

     

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KOLKATA (miningweekly.com) – Indian potash import prices have surged 21% to about $290/t for deliveries contracted between September 2018 and July 2019.

Importers have warned that higher prices, coupled with a sharp depreciation of the Indian rupee below the Rs73 a dollar mark, would sharply increase the landed price of potash and higher retail price ahead of the new crop sowing season between October and March.

Officials in fertiliser companies designated by the government as importing cannelising agents say that an increase in potassic fertiliser at the retail end will average about 35% during the next winter sowing season.

India is almost entirely dependent on imported potash for domestic manufacture of potassic fertilisers.

Officials have pointed out that with the Indian government having reduced the subsidy payable to fertiliser manufacturers to keep potassic fertiliser retail prices low, fertiliser companies would be forced to pass on the entire 35% increase in costs to farmers through a matching hike in retail prices.

According to estimates of the Ministry of Agriculture, the total demand for potassic fertiliser during the forthcoming sowing season will be about 1.72-million tons.

However, Ministry officials have ruled out any risk of shortage of potassic fertilisers during the sowing season, pointing out that all designated fertiliser companies have been directed to conclude contracts of sufficient volume which were generally for deliveries during the September to July period.

India Potash, one of the designated importers, has concluded a long-term agreement with PhosAgro, Russia, for two-million tons of fertilizer, both potassic and phosphatic, over the next three years valued at $1-billion.

The purchase agreement also contains provisions for the two fertiliser companies to collaborate in fertiliser mineral projects. Such projects could be bankrolled by the Russian sovereign fund, RDIF, for construction of fertilizer mineral plants in both Russia and India.

However, a section of government officials expressed concern over the impact of rising fertiliser retail prices on aggregate land under sowing in the new season, given the acute distress in the farm sector.

A rise in key farm inputs like diesel to operate pumps for irrigation, the higher retail price of fertiliser and a steady fall in farm produce prices could force farmers to cut down on fertiliser consumption, risking lower foodgrain production across the country, officials added.

Edited by Ajoy K Das
Creamer Media Correspondent

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