Fertilizer sales up 12 percent year-on-year due to favorable weather
25. March 2021According to the ICRA rating agency, fertilizer sales in India increased by 12 percent year-on-year. Further growth in sales volume is expected as the area of winter-sown crops this season stands at about 67.5 million hectares. This increase in cultivated area is based on a high rainfall monsoon season, sufficient water in reservoirs, and subsidies from the government. Fiscal 2021 will be critical for the fertilizer industry, ICRA estimates. Manufacturers could sell record volumes, earn good profits and reduce debt.
Ravish Mehta, chief analyst at ICRA Ratings, said due to the extraordinary increased acreage in the winter season as well as a good summer harvest, fertilizer sales volumes have reached record levels in fiscal 2021. Sales volumes of individual fertilizer or fertilizer components increased in the range of 9 to 29 percent. The substances most in demand were urea, ammonium phosphate, compound fertilizer, potassium chloride and supersphospate. Fertilizer retailers also saw strong growth in fiscal 2021, as farmers mostly stockpiled small quantities to reduce their expenses.
The Indian government plans to provide further subsidies of between $12 billion and $13 billion to the fertilizer industry in the upcoming fiscal year 2022. With good crop forecasts for the current season, prices are expected to remain stable as well as government tax revenues to increase, ICRA analysts said. The winter season of Indian agriculture includes wheat, rapeseed, mustard and chickpeas. Wheat accounts for the majority at 33.7 million hectares, or 49 percent, followed by chickpeas at 10.9 million hectares and oilseeds such as rapeseed and mustard at 7.3 million hectares. For oilseeds, a record area was cultivated for this season, most of it in the state of Rajasthan, which accounts for 35 to 40 percent of the total cultivated area. Fertilizers and related chemicals require BIS-ISI certification before being imported into India or placed on the market. MPR International GmbH – India Certification will be pleased to assist you with BIS-ISI certification and is also available to answer any questions you may have.
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