Fertiliser ministry wants Centre to control SSP rates

The fertiliser ministry has proposed that single super phosphate (SSP) fertiliser should be treated at par with other decontrolled fertilisers and its retail prices should be periodically reviewed and fixed by the Centre, instead of state governments.

It has also proposed a suitable increase in subsidy on the SSP to cover the increased cost of production.

The proposal is expected to come up before the Cabinet Committee on Economic Affairs (CCEA) at its forthcoming meeting on Thursday. The proposed new pricing and subsidy formula is based on cost escalation as in the case of the di-ammonium phosphate (DAP).

At present, the SSP is the only decontrolled fertiliser whose retail prices are fixed by state governments but the subsidy is given by the Centre.

As a result, while the cost of production of the fertiliser has risen sharply over the past few years owing to higher costs of raw materials such as rock phosphate and sulphur, the subsidy level has remained static for last four years.

Representatives of the SSP industry today told news correspondents that production had now become economically unviable and a large number of units had shut down.

"Today, only about 60 units are manufacturing SSP against 118 units in 2001," said an industry spokesman. The annual production of SSP had dropped from around 3.84 million tonne in 1998-99 to 2.3 million tonne in 2004-05.

The SSP is a relatively low-cost fertiliser used chiefly by small farmers, especially those tilling sulphur-deficient soils. SSP contains 16 per cent phosphate and 11 per cent sulphur, a micro-nutrient which is found wanting in nearly 40 per cent of the Indian farm land.

Industry representatives said the subsidy on SSP has not been raised though prices of imported rock phosphate had gone up from $45 a tonne to $67 and of sulphur from $45 a tonne to $100 in past four years.

This had increased SSP production cost by Rs 800 a tonne but the subsidy had remained static Rs 650 a tonne. However, the subsidy on DAP had been stepped up steadily to around Rs 6,000 a tonne.

The SSP industry wants that the subsidy should be raised to around Rs 1,300 a tonne, which would push up the total annual subsidy on this fertiliser only marginally, from Rs 165 crores to around Rs 350 crore.

Sulphur is deemed an essential micro-nutrient for plants, especially for oilseeds and pulses, both of which are now imported to meet the domestic demand. The use of SSP could boost the productivity of these crops.

Rate control

The SSP is a relatively low-cost fertiliser used chiefly by small farmers, especially those tilling sulphur-deficient soils

Sulphur is deemed an essential micro-nutrient for plants, especially for oilseeds and pulses , both are imported to meet domestic demand