Russian companies have ceased offering fertiliser such as di-ammonium phosphate (DAP) to India at discounted prices due to tightening global supplies after becoming the biggest suppliers to the country last year, three industry sources told Reuters.
The move in August by Russian companies to instead offer fertilisers at market prices could increase India’s import costs and subsidy burden amid a rally in global prices, as a top exporter, China, tries to curtail overseas sales.
“Russian companies are offering fertilisers at the market prices,” the official said, declining to be named due to the sensitivity of the matter.
India’s fertiliser imports from Russia surged 246% to a record 4.35 million metric tons in the 2022/23 financial year ended on March 31 as suppliers gave discounts to the global market price for DAP, urea and NPK fertilisers.
“Russian companies were offering DAP at discounts of as high as $80 (per ton). However, now they are not offering discounts of even $5,” said another Indian company official.
The current price of Russian DAP is approximately $570 per ton on a cost and freight (CFR) basis for Indian buyers, which is the same price offered to other Asian buyers, said a Russian industry official.
In July, global suppliers were offering urea at approximately $300 per ton on a CFR basis, but are now quoting $400 per ton, he said. DAP prices were around $440 per ton in July, he added.
“The global fertiliser prices are rising just before crucial state elections in India. The government has no choice but to increase subsidies to protect farmers,” added the official from the Mumbai-based company.