 "Wheat and potato farmers across the northern belt of the country are in a bind. The ongoing shortage of di-ammonium phosphate (DAP), among other problems, has doubled their cost of inputs.")
After a gap of nearly four years, the prices of Di-Ammonia Phosphate (DAP) is expected to increase by 12-15 per cent, from Rs 1,350 per bag to Rs 1550-Rs 1590 per bag. The revised rates could be effective from January 1, 2025.
One bag of DAP, which is the second most used fertiliser in the country after urea, weighs around 50 kg. The increase has been undertaken due to a spike in raw material prices.
Sources said that the unofficial cap on prices has been lifted and companies have been permitted to raise DAP and other complex rates by a specified amount.
“As DAP, theoretically, is an uncontrolled commodity, there won’t be any official order, but companies have been told to raise prices, but only up to a certain extent so that farmers are not unduly hurt,” a senior industry executive said.
The landed price of imported DAP in January 2024 according to a report by rating agency Icra, released a few months ago, was around $597 per tonne, which has climbed to around $630-$637 per tonne by October 2024.
India imports around half of its annual DAP requirement of around 11 million tonnes, while the raw materials for making them domestically are almost all imported.
The price of different grades of NPKS too are expected to go up with the price of some grades expected to rise from Rs 1,470 per 50 kg bag to almost Rs 1,725 per bag, an increase of 17.3 per cent.
The fertiliser industry has been long demanding that the unofficial cap on DAP prices should be lifted as it is hurting the companies’ margins.
Infact, the acute shortage of DAP that the country experienced a few months back that delayed sowing of some crops was squarely blamed on inability of companies to price DAP correctly and the government not releasing the subsidy on time.
Farm groups meet agri minister Chouhan ahead of Budget
Farmers and other groups today met Union Agriculture Minister Shivraj Singh Chouhan in a pre-budget meeting, demanding better value addition in the agriculture sector, increasing facilities for exporters of agricultural produce, expanding agricultural research, control on the price and quality of agricultural inputs, preventing losses to farmers, etc. Sources said that the farmers also demanded that MSP should be fixed at C2+50 per cent formula and not the existing A2+FL formula. There was also the demand to re-organise farm loans, and a long-term agriculture policy and making premium zero for small farmers under the flagship Pradhan Mantri Fasal Bima Yojana (PMFBY).
