Phospate, Potassium based fertilizers to cost more in FY'13 | SupportBiz

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Phospate, Potassium based fertilizers to cost more in FY'13

 
'The subsidy bill of P&K fertilisers alone is (expected) to touch INR52,000 crore this fiscal'

Come April and farmers across the country will have to shell out more for phosphate and potassium-based fertilizers.

A government decision to reduce the government subsidy on phosphate (P) and potassium (K) based fertilizers in the 2012-13 financial year could hit farmers hard, especially because the sowing season for Kharif crops extends from May to July. Staples like rice, Jowar, Bajra, maize and cash crops cotton, groundnut, jute, sugarcane, tobacco and hemp are grown during the Kharif agriculture season.

A subsidy is a reimbursement paid to fertilizer manufacturers for selling native or imported crop nutrients at lower prices to farmers across the country. Farm subsidies are big ticket budgetary allocations. “The subsidy bill of P and K fertilisers alone is (expected) to touch INR52,000 crore this fiscal," a senior government official was quoted a as saying in an NDTV Profit article.

The Cabinet Committee on Economic Affairs (CCEA) approved the Department of Fertilizers proposals for setting Nutrient Based Subsidy (NBS) rates for the year 2012-13, with effect from April 1, 2012. It has approved per Kg NBS rates of fertilizer nutrients nitrogen (N), phosphate (P), potash (K) and sulphur (S) for the financial year 2012-13 at INR24, INR21.80, INR24 and INR1.67 respectively, according to a Press Information Bureau (PIB) release.

The subsidy on di-ammonium phosphate (DAP) and muriate of potash (MOP) will be INR14,350 PMT and INR14,440 PMT, respectively. The per metric tonne subsidy on other P&K fertilizers covered under the NBS Policy shall be as per the nutrient content in that grade, the release added.

At the announced rate, the total subsidy outgo for the P&K fertilizers would come down by over 20 percent in the 2012-13 fiscal, states the PIB release. The Fertilizer Ministry’s recommendation comes on the back of a strengthening rupee and bearish global prices. India fixes subsidy on crop nutrients like nitrogen, phosphate and potash, which is linked to the import parity price of fertilizers, DAP and MoP, the NDTV Profit article added.

Shares of fertilizer companies like National Fertilizers, Rashtriya Chemical and Fertilisers (RCF) and Coromandel International rose 3-4 percent in early afternoon traded on the Bombay Stock Exchange (BSE), in an overall weak market, The Economic Times reports.