Fertilizer sales fell 11 per cent during the kharif season due to sluggish demand

MUMBAI: Fertilizer sales declined by 11 per cent in the first four months of FY 2021-2 and are expected to be lower than last year for the entire year, a report said. In the first four months of the current financial year, fertilizer sales declined by 11 per cent year-on-year, according to the report.

In the first six months of the last financial year, sales grew at a strong 18 per cent year-on-year due to panic among farmers during the Koro epidemic. The current modest decline should be understood in light of this broad base effect.

"Fertilizer sales have declined in the first six months of the financial year 2021," said an official with ratings agency ICRA. This is because of the use of old manure by the farmers. The planting rate in the current kharif season has been lower than last year and the use of fertilizer is also expected to remain stable.

He added that the availability of fertilizer for the current kharif season has been adequate and the government is making many efforts to ensure adequate availability for the upcoming rabi season. Thus, there is no prospect of a major decline in total fertilizer sales for FY 207. According to the report, both production and imports declined by only 6 per cent over the same period, while sales declined by 11 per cent, indicating adequate availability of fertilizer companies.

Of course, with the limited availability of di-ammonium phosphate (DAP) in global markets and the rapid rise in import prices, its availability for the coming rabi season will be a matter of concern as a ban on fertilizer exports by China could worsen the situation. The fertilizer industry is facing challenges on the import front.