New Delhi: Top Indian fertiliser companies have formed a collective to purchase 5,93,500 metric tonnes of sulphur, a critical raw material for the making of phosphatic fertilisers.
Indian Potash Ltd (IPL) floated a tender on behalf of the group, listing requirements till later in the year. This move to secure the raw material even for the winter (rabi) sowing season indicates that India's fertiliser sector is preparing for continued global supply shock and further price escalation linked to the West Asia conflict.
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India is heavily import-dependent for di-ammonium phosphate (DAP)-the second-most used fertiliser after urea-and its raw materials, making sulphur strategically important for keeping up agricultural productivity in a year when there is uncertainty amid forecasts of below-normal rainfall.
Sulphur prices have doubled since the beginning of the West Asia crisis, as the Strait of Hormuz that handles a large share of global sulphur shipments remains mostly blocked. This is expected to put a burden on the country's subsidy programme.
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India has already seen concerns around the availability of DAP and rising subsidy pressures due to elevated global prices.
According to the tender floated earlier this month, bids are invited from manufacturers, traders and suppliers holding a mandate from manufacturers for the supply of 66,000 metric tonnes of bright yellow crude sulphur on the west coast of India and 5,27,500 metric tonnes on the east coast.
The collective comprises Indian Farmer Fertiliser Cooperative Ltd (Iffco), Paradeep Phosphates, Coromandel International Ltd and Gujarat State Fertilizers & Chemicals, among others.
