India’s Fertilizer Ministry has received proposals from eleven fertilizer companies to expand or renew their fertilizer plants, which is a part of the ministry’s new urea investment policy.
The eleven private firms include, for example, Zuari Agro Chemical, Indo-Gulf Fertilizers, Chambal Fertilizers, MATIX Fertilizers and Chemicals Ltd., Kanpur Fertilizers, Bharat Coal Chemicals Ltd, and Nagarjuna Fertilizers and Chemicals Ltd. The eleven applications intending to revamp fertilizer plants include eight brownfield expansions, two greenfield expansions, and one application is about an ongoing project. Under the new investment policy, the interested companies demanded to furnish Bank Guarantee (BG) of Rs 300 crore for each project so as to make the project credible.
The annual demand for urea in India is approximately 30 million tons, while domestic production covers only 22 million tons. When it comes to potash, India’s entire consumption is imported. The country of a billion is widely expected to be the main driver of global urea demand in the upcoming months and years.
India’s import price is also believed to go up mostly as a result of tight supply outside of China and managed supply in China. In contrast, Indian potash and phosphate price are forecasted to go down due to the impact of weak monsoons and the ongoing depreciation of the Indian rupee, which puts more pressure on importers’ margins. India is the second biggest fertilizer nutrient consumer after China. There are currently more than 150 fertilizer plants and 30 urea producing units operating in the country. The units are manufacturing various combinations of nutrient formulations.