Fert Min calls meeting to discuss P&K pricing issue

Firms allowed to fix MRP of subsidised P&K fertilisers

Amid reports of higher prices charged on phosphatic and potassic (P&K) fertilisers by companies and delay in reporting their MRPs to the government, the Fertiliser Ministry has called a meeting of these firms early next month.

The companies have been allowed to fix maximum retail price (MRP) of subsidised P&K fertilisers at 'reasonable rates', as a fixed amount of subsidy is provided on each grade of P&K fertilisers under the nutrient based subsidy (NBS) scheme, based on their nutrients content.

In order to ensure that the MRPs fixed are reasonable, the fertiliser companies are required to report the MRPs of their products to the government for monitoring of prices.

"There have been reports that companies are charging higher MRPs and therefore we called a meeting to discuss the matter," a source said

The ministry has issued a notice for the meeting likely to be held in first week of May.

"Delay in reporting of MRPs by companies. Practice of reporting higher MRPs..And absence of a proper mechanism to cross verify the genuineness of the MRPs reported are causing difficulties in monitoring MRPs to find out the reasonableness of the prices," the Fertiliser Ministry said in the notice.

Last year, the Ministry has also issued a notice to the companies calling for advertising the reduction in prices following the fall of prices in the international market.

Meanwhile, for fiscal 2014-15, the government had reduced potash subsidy by Rs 3.33 per kg while maintaining the subsidies of all other complex fertiliser at last year's level, resulting in saving of Rs 900 crore to the exchequer.

The government has also said that reduction in subsidy rates would not lead to an increase in retail prices of potash, as its prices in the international market has also come down.

During the past one year, the total demand of both potash and phosphate stood at over 10 million tonnes.