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Indian National Fertilizer Company: India's continued increase in fertilizer consumption will continue to expand domestic urea production capacity
Time:2019-01-24   Read:596second  
Recently, "China - ASEAN Peak Forum on Agricultural Assets Industry 2018" was solemnly held in Beijing. The forum is co-sponsored by the All-China Supply and Marketing Cooperative and the China-ASEAN Center, co-sponsored by the National Supply and Marketing Cooperative Agricultural Resources and Cotton and Ma Bureau, Guangxi Zhuang Autonomous Region Supply and Marketing Cooperative, China ASEAN Agricultural Commerce Chamber, China Agricultural Production Material Circulation Association and China Cooperative Times Co-sponsored. The conference invites representatives of leading enterprises from China, ASEAN and India to talk about their experience in international market development and the trend of the market after the event. Now we are launching the excellent report of the conference to the readers.

National Fertilizer Company of India is a company that produces chemical fertilizers, organic fertilizers and industrial chemicals. It is the second largest urea producer in India. Ashtush Arola, general manager of Indian National Fertilizer Company, introduced the basic situation of Indian agriculture and fertilizer at the meeting.

India has a large agricultural population and a large demand for urea. Although the contribution of agricultural GDP is only 1/7 of India's GDP, two-thirds of India's population depends on agriculture, mainly small farmers, and about 86% of farmers have less than 2 hectares of arable land. India's huge agricultural population and its goal of food self-sufficiency have created a huge demand for fertilizers, especially urea, in the Indian market. However, the price of urea in India is only US$80 per ton. Through subsidies and other means, the government has made fertilizers affordable to farmers, and also allowed urea producers to get at least 12% return, thus achieving a balanced policy layout.

In recent years, fertilizer consumption in India has increased. Among them, the consumption of nitrogen, phosphorus and potassium increased, but the consumption of urea increased the most. In 2017-2018, India's demand for urea was 30 million tons, of which 24 million tons were produced domestically and the remaining 6 million tons were mainly imported from the international market. The proportion of nitrogen, phosphorus and potassium consumption in India is unbalanced. At present, the proportion of nitrogen, phosphorus and potassium consumption in India is 3:2:1. The proportion of nitrogen consumption is too high and the use of phosphorus and potassium fertilizer is less. The main reason is that the price of urea in India is too low, and the price of other imported fertilizers is too high, which makes Indian farmers more inclined to consume urea, resulting in the imbalance of the proportion of the three.

_The production of fertilizer industry in India is relatively concentrated. There are 31 large-scale urea plants in India, whose capacity covers 80% of urea demand in the country. At the same time, there are 21 large-scale phosphate fertilizer plants in India, which provide 50% of the country's supply of phosphate fertilizer. But these factories are facing a problem, that is, the lack of investment, resulting in many factories shut down. India's urea industry will be able to achieve self-sufficiency if the shut-down factories can resume production.

_India has many supporting policies in the fertilizer industry, especially in urea. In 1977, when India had only 3 million tons of urea production capacity, the government subsidized urea prices, and now production capacity has risen from 3 million tons to 24 million tons. Investment in the urea industry in India is mainly concentrated on new projects, re-production of factories and renovation of old factories. The Indian government has developed a protection mechanism to ensure that the profits of urea producers are sufficient to cover operating costs so that these plants can continue their production activities. At present, eight closed urea plants are being revived. The output of the new integrated plant of the National Fertilizer Company of India has increased from 4 million tons to 5.3 million tons, increasing the output of urea by 1.3 million tons. By 2023, these reworked and revamped plants will be put into production, and the overall urea production in India will be further developed.

_With the continuous commissioning and re-production of Indian fertilizer plants, India will gradually achieve urea self-sufficiency. In 2021, India's urea production is expected to reach 33 million tons and its demand will rise to 33.76 million tons. India is expected to be able to export urea to Southeast Asian countries after 2022. This will be a very good investment opportunity for Southeast Asian countries. The Indian National Fertilizer Company is willing to reduce costs substantially and achieve mutual benefit by setting up factories and conducting production and sales locally.
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