Despite a strong push from the government and ambitious targets for production and adoption, the fiscal year 2023-24 witnessed a sharp 43 per cent drop in nano-urea sales
Last year, around this time, the Union Minister for Chemicals and Fertilisers Mansukh Mandaviya had said “Consumption of urea this fiscal (read: FY 2023-24) is likely to be 8 percent less than in FY 2022-23 due to the use of its liquid nano variant. Because of this and higher domestic production, import of urea, the soil nutrient that accounts for 70 percent of the fertilizer subsidy bill, declined more than a fifth on year in 2023. Further spread of nano urea consumption and the start of a new large urea plant (Talcher in Odisha) by September 2023 would lead to elimination of imports in two-three years”.
Nano-urea is urea in the form of a nanoparticle containing nitrogen particles of 20-50 nanometres (nm) in size. It provides nitrogen or ‘N’ to plants in liquid form as an alternative to conventional urea which is mostly supplied as prill (it is a small diameter, spherical white solid). The minister’s statement pointed towards the commitment of the government to promote the use of nano-urea so that imports of conventional urea are brought down to eliminating it.
However, according to data from the Fertiliser Association of India (FAI) – an umbrella body of the fertilizer industry – the sales of Nano urea plummeted by nearly 43 per cent during FY 2023-24 (this happened after growing by a significant 62 per cent during FY 2022-23). Meanwhile, the total production of Nano urea during FY 2023-24 was 81 per cent less than in the previous FY.
The manufacturers knew that there wouldn’t be much demand for it; so they reduced the output even as its production capacity rose by 59 per cent.Why did the sales of Nano-urea decrease? But, before that, we need to understand why the government is so keen to promote its use.
The beauty of nano-urea lies in its ultra-small size and high surface area (10,000 times over 1 mm urea prill), which enable easy absorption by plant leaves. These particles enter the plant through cuticular pores, or stomata, and then penetrate the cell membranes through endocytosis. Once inside the cell, these release nutrients slowly and ensure full absorption by eliminating waste that normally happens with conventional means. The innovator namely Nano Biotechnology Research Centre (NBRC) of the Indian Farmers Fertiliser Cooperative Limited (IFFCO) claims its efficiency (a measure of how much of the ‘N’ supplied from it is absorbed by the plant) is over 80 per cent against around 40 per cent for the conventional stuff.
The use of nano-urea also results in higher crop yield by 3-16 per cent when compared to traditional urea. Moreover, unlike the latter which raises environmental concerns including nitrate leaching, global warming, ozone layer depletion, and groundwater pollution, the former causes less soil, water and air pollution. According to a study, two foliar sprays of nano-urea curtailed nitrogen load by 25 per cent, besides reducing the greenhouse gas (GHG) emission from 164.2 to 416.5 kg CO2-eq ha-1 under different crops.
A more startling claim made by IFFCO/NBRC is that a 500-ml bottle of nano-urea is equivalent to a 45-kg bag of conventional urea.
The latter contains 46 percent N nutrient, or 20 kg (45×0.46). In contrast, the former contains 4 per cent N, or 20 grams (500x.04). The equivalence between the two means that urea in nano-form with a mere 20 grams can achieve what conventional urea does with 20 kg - a gap of 1000 times in efficiency.It is this monumental difference in efficiency that also enables the manufacturer to deliver a 500-ml bottle of nano-urea to farmers for Rs 240 without any subsidy support.
In contrast, the cost of supplying equivalent conventional urea in a 45 kg bag, is over eleven times at around Rs 2650 (while, this figure is for imported urea, even for urea produced domestically, the cost is substantially higher and varies from unit to unit), the Government has to give a subsidy of Rs 2410 to make available to the farmer at the same price of Rs 240.There being 22.22 bags in a ton of urea (1000/45), the subsidy on the import of a ton of conventional urea comes to Rs 53,550 (2410×22.22).
If we were to replace one million tons of imported urea with nano-urea which doesn’t require any subsidy support, the government would save Rs 53,550 million or Rs 5355 crore. Mandaviya had kept a target of producing about 55 million bottles of nano-urea during FY 2023-24 which replaces 2.5 million tons of conventional urea. This would yield savings of around Rs 13,400 crore in subsidy.
Around 600 cubic metres of natural gas (NG) is needed to produce a ton of conventional urea. For generating the same effect through the nano-urea - given the efficiency difference of 1000 times, the requirement of NG would be a mere 0.6 cubic meters (600/1000). This would lead to huge savings in the import of gas (currently, India imports one-third of its requirement for domestic urea production). Drastic reduction in load on infrastructure will be a bonus. Imagine the impact of handling, moving, storing and delivering a 500 - ml bottle of nano-urea vis-à-vis a bag of conventional urea containing 45,000 grams of the material.
The use of nano-urea thus offers unprecedented possibilities in terms of not just a substantial reduction in fertilizer subsidy but also trimming excess consumption of urea thereby reducing the imbalance in fertilizer use improving soil health, and helping achieve the environment-related goals. Additional benefits will accrue by way of savings in foreign exchange outgo, and a reduction in the current account deficit.
What explains the setback during FY 2023-24?Reportedly, the industry’s argument that the fall in production and sales was due to ‘the launch of new products such as Nano urea plus, with a higher concentration of nitrogen and reduction in sales of earlier variants of Nano urea that had lower nitrogen concentration’ is untenable. This is because whatever the level of ‘N’ concentration, fundamentally the product remains ‘Nano-urea’. Another explanation is that ‘the drop in sales coubecausee fact that farmers had bought large quantities of Nano urea in the previous years’ doesn’t cut ice. Farmers generally are not prone to stocking fertilizer material as the majority of them just don’t have the wherewithal to hold stocks.
A third possibility that lower domestic sales could be due to the export of nano-urea doesn’t make sense. For a country that depends heavily on imports and even incurs huge subsidies, why would the government allow exports? The industry, however, concedes that there was unsold inventory with dealers and that might have impacted sales during 2023-24. This shows that even during 2022-23, farmers didn’t lift nano-urea to the extent revealed by the sales figures of that year. One can’t escape inferring that nano-urea could be losing charm amongst farmers.
If it is due to factors like their being unable to cope with the rigours of the new technology (spraying it on leaves is more challenging than prill urea) or shortage of skilled labour etc, those can be overcome. But, if it is due to tall claims regarding efficiency or yield going haywire, it is a matter of concern. For instance, a study released by Punjab Agricultural University (PAU) in January 2024 says that the ‘use of nano-urea led to decrease in the yield of wheat and rice by 21.6 per cper cent 13 percent respectively’.
(The writer is a policy analyst; views expressed are personal)
