Fertiliser Cos Say No To Potash Import For Now.

In a concerted bid to pressurise global potash supplying giants into tempering high import prices, the Indian fertiliser industry announced its decision on Monday "to take holiday" from further import of the commodity .

"The unreasonable, exorbitant international price of potash is a result of cartelisation of suppliers. Indian fertiliser industry has decided to take a holiday from application of imported Potash for the present," an industry statement announced here. In 2010-11, India imported a whopping 6.4 million tonnes compared to only 2.6 million tonnes in 2003-04.

The supplier cartel, however, is currently quoting a price of $500/tonne, much higher than the $390/tonne price set by the government. The government subsidy is pegged to this price and cost in excess of this will have to be borne by the companies. That would mean that the industry would be stuck with high-priced inventories and perhaps be forced to hike farmgate price.

"We paid a high price for phos acid imports. But thanks to enough imports by industry last year, there is sufficient supply of NPKs for the coming kharif season and little reason for worry," an official of the Fertiliser Association of India (FAI) told ET. Consequently, no fresh imports have been contracted this year (2011-12) on account of the exorbitant prices being quoted by the global potash cartel. Summer sown crop accounts for a dominant part of the country's agricultural output, especially since a large part of the country is dependent on the monsoons for farming. In view of the high application of potash during last five years, the availability of potash in the soil has improved..

Further the crop residues when applied back to the soil in any form, including burning further supplements the availability of potash in the soil.

To support its contention that reduced use of P&K fertilisers did not have a significant impact on food grain production, the FAI held that " in 1992-93, when prices of P&K fertilisers were decontrolled, application of these fertilisers declined sharply. However, there was no adverse impact on food grain production. In fact, food grain production continued to increase for next three years. Thus, limited application or non-application of potash is unlikely to affect productivity."

Source : economictimes.indiatimes.com