Why fertilisers could be the war’s soft underbelly victim for India

Fertilisers are food for crops. They supply essential nutrients such as nitrogen (N), phosphorous (P), potassium (K) and sulphur (S) for them to yield grains, fruits or vegetables.

India is self-sufficient in the production of most food and non-food crops, barring oilseeds and pulses. But this isn’t so with fertilisers.

In 2025-26 (April-March), India is expected to import nearly 10 million tonnes (mt) of urea and 6.5 mt of di-ammonium phosphate (DAP), as against domestic production of 30 mt and 3.5 mt respectively. The country’s entire projected 3 mt consumption of muriate of potash (MOP) would be imported, while in complex fertilisers – which contain N, P, K and S in different combinations – domestic production is likely to be 12.5 mt and imports at 4 mt.

The War factor

The accompanying tables show the share of Gulf Cooperation Council (GCC) countries – Oman, Qatar, Saudi Arabi, United Arab Emirates (UAE) and Bahrain – in India’s urea imports at roughly 75% during 2024-25.

In DAP, too, the largest source of India’s imports is Saudi Arabia. In MOP, the GCC states per se are insignificant suppliers, but it’s not so if other West Asian countries such as Jordan and Israel or Turkmenistan (Iran’s northern neighbour) are included.

The current US-Israel versus Iran war is, in a sense, a reminder of how much India’s agriculture and food security is vulnerable to the vicissitudes of geopolitics.

That becomes more apparent if one factors in Russia (which is fighting Ukraine for over four years now) and China (India’s not-so-friendly neighbour). Russia is India’s top supplier of MOP and No. 3 in urea and DAP. China was actually India’s foremost source of both urea and DAP as late as 2023-24.

Import dependence, moreover, isn’t confined to finished fertilisers.

Domestic urea plants run on natural gas as feedstock. The fertiliser sector accounts for close to 29% of India’s total natural gas consumption. Just over half of India’s natural gas consumption requirement is met by imports. India imported 27 mt of liquefied natural gas (LNG) in 2024-25, out of which 11.2 mt came from Qatar, 3.5 mt from UAE and 1.8 mt from Oman. During April-December 2025, the 19.9 mt of imports included 9 mt from Qatar, 2.1 mt from UAE and 1.2 mt from Oman.

It’s worse with DAP, MOP and complex fertilisers. India hardly has any mineable rock phosphate (for P), potash (K) or elemental sulphur (S) reserves. The merchant ammonia providing ‘N’ for DAP and complex fertilisers is imported. Out of the 2.5 mt ammonia imports in 2024-25 (2 mt in April-December 2025), almost 1 mt (0.8 mt) was from Oman, 0.9 mt (0.7 mt) from Saudi Arabia and 0.2 mt (0.06 mt) from Qatar.

The intermediates for manufacturing DAP, India’s second most-consumed fertiliser after urea, are phosphoric acid and ammonia. Phosphoric acid is primarily sourced from Jordan, Senegal, Morocco, China and Tunisia. Thankfully, not all (save Jordan) are involved in the ongoing Iran and Russia-Ukraine wars.

Some Indian DAP manufacturers have own phosphoric acid plants, for which the raw materials (rock phosphate and sulphur) are again imported. Imports of rock phosphate are from Jordan, Egypt, Morocco, Togo, UAE, Senegal, Algeria and Lebanon; and of sulphur from Oman, UAE, Qatar, Kuwait and Saudi Arabia.

Incidentally, Russia was a major exporter of ammonia and sulphur. Its ammonia exports collapsed after a 2,471-km pipeline connecting Togliatti in Russia to the Ukrainian Black Sea port of Odesa – through which some 2.5 mt of the liquefied chemical passed annually – suffered damage during the war. Ukrainian drone attacks on its oil refineries have, likewise, led to production losses and a ban on exports by Russia. The result: Landed prices of imported sulphur in India have surged to around $550 per tonne, from $250 levels a year ago.

The brighter side

The one consolation India has, for now, is its comfortable stocks position.

“February-end urea stocks, at 5.5 mt, are above the 4.9 mt for the same date of 2025. The same goes for DAP (2.5 mt versus 1.3 mt) and complexes (5.4 mt versus 3.2 mt),” G. Ravi Prasad, a fertiliser industry veteran, noted.

The situation was quite precarious at the start of this rabi (winter-spring) cropping season. On October 1, 2025, urea stocks were a mere 3.7 mt, compared with 6.3 mt on October 1, 2024. DAP stocks were higher though (2 mt versus 1.2 mt), while unchanged at 3.6 mt for complex fertilisers.

The subsequent stock build-up happened because of large-scale imports, both of urea and DAP. India has not only stepped-up imports, but also bought more material from less-prolific suppliers such as Indonesia, Malaysia, Egypt, Finland, Vietnam and Algeria for urea and Australia for DAP (see tables).

Stocks aside, India is lucky that the next kharif (monsoon) planting season will kick off only from mid-June. “We are at present just about harvesting wheat, mustard and other rabi crops. The prepositioning of stocks for the upcoming kharif can be appropriately planned,” Prasad added.

Uncertainty challenge

That mild comfort would be short-lived, however, if the war stretches beyond March.

Most urea plants are operating at about 60% capacity due to inadequate gas availability. Some – like Chambal Fertilisers & Chemicals’ Gadepan-II unit at Kota (Rajasthan), Indorama India’s at Jagdishpur and Hindustan Urvarak & Rasayan’s at Gorakhpur (both in Uttar Pradesh) – have gone in for annual routine maintenance shutdown ahead of the peak marketing season.

“We’ll have a problem if LNG supplies from QatarEnergy and Abu Dhabi National Oil Company fully dry up. These companies, along with Saudi Aramco, are also big exporters of sulphur. Their LNG and sulphur – besides ammonia from QatarEnergy and Saudi Arabia’s Maaden and SABIC – is all shipped through the Strait of Hormuz,” the CEO of a leading domestic fertiliser company told The Indian Express.

According to him, the closure of the Strait by Iran – vessels aren’t moving also due to non-availability of war risk insurance and physical security concerns – will mainly affect the flow of LNG, ammonia and sulphur. Finished fertilisers can continue to come through the Black Sea-Turkish Straits-Mediterranean-Suez Canal-Red Sea-Indian Ocean route or via the Cape of Good Hope.

“We will have to also look for more LNG from the US, Australia, Angola and Cameroon and ammonia from Indonesia, Malaysia and China,” the official pointed out. If the war prolongs, the government might have to also prioritise natural gas allocations.

Out of India’s total natural gas consumption of 58,802 mmscm (million metric standard cubic meters) during April-January 2025-26, the top three segments were fertilisers (16,812), city gas distribution (13,699) and power (6,898), with others making up the balance 21,392 mmscm.

In the event of worsening disruptions from West Asia, the government may choose to preserve the allocations of the first two segments, from the standpoints of food security and ensuring uninterrupted supply of clean cooking and transport fuel for consumers.

Harish Damodaran is National Rural Affairs & Agriculture Editor of The Indian Express. A journalist with over 33 years of experience in agri-business and macroeconomic policy reporting and analysis, he has previously worked with the Press Trust of India (1991-94) and The Hindu Business Line (1994-2014). ... Read More