Urea sales drop 3% in April-May, likely to pick up in June-July
Urea sales fell 3 percent to 3.12 million tons in the April-May period, compared to 3.23 million tons a year earlier, even as domestic production increased by 16 percent and imports increased by 37 percent.
However, as the monsoon has already covered almost all states except for a few districts in Rajasthan, Haryana and Punjab, fertilizer demand in July may rise significantly with the expected rise in sowing areas.
Official sources said the fertilizer companies managed to sell 64 percent of the total demand of 4.86 metric tons in the first two months.
“There was no fear of El Niño, and the monsoon was not late last year. Therefore, farmers bought a lot of urea during May before Kharif sowing started from June. The situation this year is uncertain because despite losing two weeks in progress, an official source said Monsoon, it is likely to cover the entire country ahead of its usual schedule on July 8.
Urea sales may rise in June-August, the main sowing period as it appears that farmers did not stock up on the fertilizer before the sowing season. In May 2022, urea sales increased by a quarter as farmers scrambled to buy and stockpile all major fertilizers amid reports of scarcity in many places, particularly in Madhya Pradesh and Rajasthan.
According to official data, urea sales amounted to 1.18 million tons in April and 1.94 million tons in May this year. Support on urea for the first two months was Rs.16,133 crore – Rs.6,867.38 crore in April and Rs.9,265.98 crore in May.
For the current Khareef season, the government has pegged the demand for urea at 17.07 metric tons during April and September while the demand in June was estimated at 3.06 metric tons.
The demand for urea nanoparticles this fall season has been estimated at 1.78 crore (500ml per bottle), which is equivalent to 0.4 metric tons of conventional granular urea.
Monsoon rainfall during the period from 1 to 27 June amounted to 115.0 mm, against 141.8 mm considered normal for the period, showing a deficit of 19 percent. Although 18 states have reported a lack of precipitation this season, many have received a good amount of rain in the absolute range that is enough to start planting crops.
For example, with precipitation of 66 mm, Maharashtra has “too deficient”, but with precipitation of 62-63 mm, Punjab and Haryana have “excess” precipitation.