Fertiliser Sector Misses First Half Targets
According to an internal note prepared by the Union fertiliser ministry, the cooperative and public sectors urea production was 37.73 lakh tonnes during April-September against a target of 40.53 lakh tonnes.
The private sector recorded an output of 33.84 lakh tonnes during this period against a target of 34.89 lakh tonnes.
In the case of DAP, the cooperative and public sector units produ
ced 3.14 lakh tonnes against a target of 3.99 lakh tonnes.
The private sector DAP output was 7.85 lakh tonnes against a target of 8.83 lakh tonnes.
According to industry sources, the poor performance was mainly due to the state governments indecision over fixing of indicative prices for DAP and the Centres failure to release a subsidy backlog of Rs 400 crore to the fertiliser industry.
The delay thwarted the industrys bid to import raw materials.
The overall availability of urea has not been affected as the government is making up for the shortfall by importing the product, but trends indicate that there may be a reduction in the import component this year.
In the first half of the current year, only about 9 lakh tonnes of urea were imported.
There is a lot of uncertainty about DAP imports.
According to the fertiliser ministry, only about 4.5 lakh tonnes of DAP has been contracted so far.
Another reason for the decline in DAP output is the firming up of international prices of ammonia and phosphoric acid and the rise in naphtha prices.
With the state governments yet to fix prices, the industry seems to have decided to go slow on production.
Among the public sector undertakings (PSUs), Rashtriya Chemicals & Fertilisers Ltd (RCF) and National Fertilisers Ltd (NFL) saw a sharp drop in production of urea.
Industry sources attributed the huge shartfall in urea production at NFL to poor supplies of coal and fuel oil, and that at RCF to equipment problem at its Thal plant.
NFLs Nangal-II, Bhatinda and Panipat plants experienced a shortfall in urea production.
The Bhatinda plant was able to achieve an output of only 1.47 lakh tonnes against a target of 2.9 lakh tonnes, while the Panipat plants output was 1.66 lakh tonnes against a target of 2.32 lakh tonnes.
Some of the other public sector undertakings - Fertiliser Corporation of India, Indian Farmers Fertiliser Cooperative Ltd (IFFCO) and Krishak Bharati Cooperative Ltd - however achieved a rise in urea production.
In DAP production, Paradip Phosphates Ltd achieved an outout 1.47 lakh tonnes against a target of 2.15 lakh tonnes, while IIFCOs Kandla plant experienced a shortfall of 20,000 tonnes.