An official from the department of fertilizers is reported to have said that by putting 45 kg of urea in a bag, it is possible to achieve 10% saving in consumption. His logic is that farmer calculates requirements on per acre basis. He needs 90 kg which can be met with 2 bags of 45 kg each against current practice of using two bags of 50 kg each. Are we to infer that until hitherto, 10% urea was going waste as he was forced to buy 100 kg – against need of 90 kg – and that loss will now be prevented with use of 45 kg bag? How come such an innovative idea did not strike policy makers earlier?...
More
No comments
Category: Demand vs Supply
Self-sufficiency in fertilizers – building castles in the air
Union Minister for chemicals and fertilizers, Ananth Kumar has announced government’s decision to revive five closed plants of Fertilizer Corporation of India [FCIL] and Hindustan Fertilizer Corporation Limited [HFCL] viz. Talcher [Odisha], Ramagundum [Telengana], Sindri [Jharkhand], Barauni [Bihar] and Gorakhpur [Uttar Pradesh]. To be commissioned by 2020-21, their revival is expected to add 7.5 million tons [mt] of urea capacity. Kumar has also exuded confidence that the decision of the government to make neem coating of urea mandatory [2015] will result in 10% improvement in the efficiency of fertilizer use. Taking urea consumption of about 33 mt annually, this will result in saving of about 3.3 mt. The minister also referred to steps aimed at enticing manufacturers to increase utilization...
More
No comments
Gains from neem coating urea – real or imaginary!
The exhortations by prime minister, Modi and his cabinet colleague, chemicals and fertilizer minister, Ananth Kumar regarding the success of neam coating of urea [ordered by Modi last year to cover all of domestic production and import] could have much deeper ramifications than mere stoppage of diversion to industrial use and smuggling to neighboring countries. The total consumption of urea in India is about 30 million tons annually including 22 million ton indigenous and 8 million tons imported. Since, all of this is sold by manufacturers/importers at a low ‘controlled’ price under the Fertilizer Control Order [FCO], the excess of cost of production/import and distribution over this price is reimbursed to them as subsidy by Government of India [GOI]. For...
More
No comments
Tata exit from fertilizers – symptomatic of deeper malaise
Tata Chemicals Limited [TCL] made headlines on August 10, 2016 by announcing sale of its urea business [it has a plant in Babrala, Uttar Pradesh with 700,000 tons ammonia and 1.2 million ton urea capacity] to Yara Fertilizers India Private Limited [YFIL] – Indian arm of Norway’s Yara lnternational ASA – for a sum of Rs 2670 crores [after obtaining all regulatory approvals and court sanction, the transaction will be consummated within 9-12 months]. TCL had decided to exit fertilizers long back. However, a number of earlier attempts had failed as it did not find any taker; even this one is a distress sale and will fetch the company only 2/3rd of the money so far invested. Tata has also...
More
2 comments
REVIVING INDIA’S FERTILISER PLANTS
Efforts by successive Government’s to achieve self-sufficiency in the production of fertilisers have failed. The Modi Government should broaden its options and look for expansion of existing units or set up joint ventures abroad The Coal India Limited (CIL) and the National Thermal Power Corporation limited (NTPC) signed a joint venture agreement to revive the Sindri (Jharkhand) and Gorakhpur (Uttar Pradesh) plants of the Fertiliser Corporation of India (FCIL), at an estimated cost of about Rs 18,000 crore, over the next four years. CIL and NTPC operate in coal and power sectors respectively and both have their plates full to meet their commitments in those areas to help India achieve the growth target. But, given fertiliser is a different cup...
More
No comments
Fertilizer woes – quick fix won’t work
On July 4, 2016, the minister for chemicals and fertilizers, Ananth Kumar announced government’s decision to reduce maximum retail price [MRP] of non-urea fertilizers viz., DAP [di-ammonium phosphate: 18% nitrogen [N] & 46% phosphate [P]]; MOP [muriate of potash] [60% potash [K]] and complex fertilizers [contain N, P and K in different proportions] with immediate effect. The retail price of DAP has been reduced by Rs 2,500 per ton to Rs 22,000/tonne, MOP by Rs 5,000 per ton to Rs 11,000/tonne and those of complex fertilizers by Rs 1,000/tonne on an average. The minister went on to say that the rate cut would entail a benefit of Rs 4,500 crore to farmers and help promote balanced use of fertilizers. On...
More
No comments
‘Make in India’ skips fertilizers
Even as Modi – government has unleashed a wave of reforms to accelerate the pace of foreign direct investment [FDI] and give a boost to prime minister’s flagship “Make in India”, fertilizers happens to be one sector that has been completely bypassed. While, indigenous production in all segments of this crucial industry continues to languish, the most neglected is DAP [di-ammonium phosphate; it contains 18% nitrogen [N] and 46% phosphate [P]] where traders have hey-day at the expense of domestic industry. Of the total DAP consumption in India, nearly 60% is met from imports. India is the single biggest buyer of DAP in global market with a share of more than 50 per cent of globally-traded DAP. Even for domestically-manufactured...
More
No comments
Revival of sick fertilizer PSUs – a mirage
The revival of sick plants of two central public sector undertakings [PSUs] viz., Fertilizer Corporation of India Limited [FCIL] and Hindustan Fertilizer Corporation Limited [HFCL] is once again in the news. Last year, the Union Cabinet had approved a plan to revive the Barauni [Bihar] of [HFCL], Gorakhpur [UP] and Sindri [Jharkhand] of FCIL through auctions. Having failed to get a good response through this route, the central government had asked cash-rich PSUs viz., Oil and Natural Gas Corporation Limited [ONGC], National Thermal Power Corporation limited [NTPC] and Coal India Limited [CIL] to adopt one closed urea plant each for revival. Accordingly, CIL and NTPC have signed an agreement to form a joint venture [JV] to revive Sindri and Gorakhpur...
More
No comments
Tackling urea shortage – neem coating won’t help
Addressing an election rally in Tamil Nadu, prime minister listed the major achievements of his government which, he exhorted, is exclusively for the poor and the oppressed and is sorting out issues faced by them one by one. One of these achievements is “helping the poor farmers surmount the urea shortage which has been haunting them for years”. Modi said immediately after swearing in as PM, he received letters from Chief Ministers of States and farmers about the severe shortage of urea. “Urea was being sold in the black market and farmers had to bribe officials to get their quota of urea. My government put an end to the practice of corruption in the sale of urea. We have started...
More
1 comment
It’s wrong to deny gas to the fertiliser sector
And worse still, to favour urea producers over decontrolled fertiliser units in gas allocation, exacerbating the nutrient imbalance The manner in which gas is allocated within the fertiliser sector smacks of arbitrariness. The Centre gives a uniform subsidy to all manufacturers, including those of decontrolled complex fertilisers, under the Nutrient Based Scheme (NBS) . Why, then, does it use a different yardstick for allocation of gas to manufacturers of urea on the one hand and decontrolled fertiliser on the other? A two-judge bench of the Delhi High Court has ordered the government to resume supply of natural gas to Deepak Fertiliser and Petrochemicals Corporation (DFPCL), a manufacturer of decontrolled phosphatic fertilisers, which was arbitrarily suspended last year. The bench has...
More
No comments