India sees red in China’s decision to possibly chase greenbacks (sorry, Yuan), and exert trade leverage globally. For the second time in the recent past, as the Indian farmers began sowing Rabi crops such as wheat, barley, mustard, peas, among others, China suspended exports of crucial fertilisers. Imports of several products such as urea, phosphatic ingredients, and urea-solution products like AdBlue were hit. China is the dominant global supplier, and the export halt risks escalation in international prices, and supply chain disruptions.
“This may lead to a 10-15 per cent increase in the prices due to tight global supplies, and uncertainty among countries depending on imports,” said Rajib Chakraborty, National President of Soluble Fertiliser Industry Association. More importantly, as was the case a few months ago when there were long queues to buy fertilisers, it may create severe shortages in India, even as the Rabi season is on. This development is over and above India’s attempt to open farm trade due to the US’ pressures, and an era of high American tariffs.
In the middle of this year, China temporarily lifted an earlier ban on exports, but increased monitoring and inspections. As India celebrated this gesture, which was linked to better India-China ties in the middle of American trade chaos, China announced a suspension in mid-October till further notice. Experts like Chakraborty expect the decision to last for 5-6 months this time. The timing is not as detrimental as last time, for the Rabi season is on.
“There is no immediate shortage for the ongoing Rabi season (October-March), as adequate supplies were secured by Indian traders through global sources,” according to Chakraborty. While existing stocks will minimise and mitigate immediate shortages, prolonged Chinese suspension may pressure India to source fertilisers from alternate suppliers such as South Africa, Chile, and Croatia. The problem is that these suppliers can cater to select products. So, in case the Chinese move extends beyond March 2026, the effect on Indian farmers, and the next season may be palpable.
Based on working principle, specialty fertilisers supplied by China broadly include water-soluble products, micronutrients, slow release, and customised fertilisers. India meets its overall needs through a mix of domestic production and heavy imports, which are crucial for specialty and advanced fertilisers. India produces large quantities of basic fertilisers like urea and DAP (diammonium phosphate), and both public and private sector firms play key roles.
According to the Union Government, there is no official classification for “specialty fertiliser” in the Fertilizer Control Order, 1985. “However, 100 per cent water-soluble complex fertiliser, 100 per cent water-soluble mixture of fertiliser category is there, and used mainly in cash crops and horticulture crops,” stated an answer to a Parliament question. It added that none of these categories were subsidised. Against an annual consumption of water-soluble fertilisers of 3.35 lakh tonnes (2023-24), a significant quantity was imported from China, and alternative suppliers such as Belgium, Egypt, Germany, Morocco, and the US.
Under the official subsidy scheme, relief is given for phosphatic and potassic (P&K) fertilisers based on nutrient content, specifically the percentages of nitrogen (N), phosphorus (P), potassium (K), and sulfur (S). Urea is regulated separately, and is not part of the above-mentioned scheme, according to an answer to a Parliament question. Urea is provided to farmers at a statutorily notified Maximum Retail Price, which comes to Rs 242 for 45 kg (exclusive of charges towards mandatory neem coating, and taxes, as applicable).
The local fertiliser firms produce 1.24 lakh tonnes of water-soluble fertilisers, but 1.6 lakh tonnes is imported from China. The domestic makers can import as per business dynamics, and requirements. They can source products from any suppliers, which includes the US, to offset the shortfall caused by reduced imports from China. In the case of micronutrients, India imports major quantities from Greece, Turkey, Spain, Singapore, the Netherlands, and the US. Only “a little quantity” of zinc sulphate monohydrate comes from China.
Despite varied and possible sources, there are trade-related and other issues. The resolution to the ongoing tariff tussle with the US will depend on the trade negotiations. Hence, American imports in the wake of China’s suspension are iffy. The relations with Turkey have soured since its support to Pakistan this year, after India launched Operation Sindoor to retaliate against Pahalgam terror.
Fortunately, New Delhi has faced, and addressed import shortages several times in the past. Between 2018 and 2020, during the US-China trade war, retaliatory tariffs disrupted global fertiliser, and agrochemical supply chains. India successfully sought alternative supplies from Jordan and Morocco. The global shock in 2022 due to the Russia-Ukraine war pushed up international fertiliser and feedstock prices, and created supply stress and higher import bills.
Volatility continued through 2023 and 2024 as global supply chains, shipping costs, and shifting export patterns kept prices elevated. Media reports flagged rising dependence on imports for key nutrients, and growing concerns about affordability for farmers. By late 2024, there were reports of acute regional shortages in India, and sharp price movements for specialty fertilisers. China’s earlier ban on movement of fertilisers exacerbated the scenario.
By mid-2025, farmers complained of acute shortages, and there were reports of long overnight queues to buy fertilisers. One is not sure but there may be links to the fact that India’s imports declined, even as policy moves focused on diversifying foreign suppliers. According to official figures, import of urea came down from 75.8 lakh tonnes in 2022-23, to 70.42 lakh tonnes in 2023-24, and a mere 56.47 lakh tonnes in 2024-25. This marks a cut of nearly one-fourth.
A decrease was registered in P&K products. Imports in 2022-23 totaled 112 lakh tonnes, which fell to 106.53 lakh tonnes in 2023-24, and 103.82 lakh tonnes in 2024-25. The fall in this case was lower, or less than 10 per cent. Given that global supplies are forever in a state of turmoil in recent times, India has decided to seek long-term solutions, rather than react to events each season or year.
One of the proposals on the table, according to media reports, is for Indian companies to set up urea-making units in Russia, which has an abundance of ammonia and natural gas reserves. One is not sure how much time it will take for these plants to be operational, if they are given the green signal. At present, the US is trying to turn the screws against Russia. The former, apart from national sanctions, imposed specific sanctions against two major Russian oil producers.
Clearly, deft diplomatic and trade maneuvers, with some fortunate positive trends in the future, may enable India to fertilise its fields, and turn them lush green. This is crucial for the farmers.
(The author has more than three decades of experience across print, TV, and digital media)