Despite the sanctions: Russia increases fertilizer exports to India by 371%
Russia became the largest supplier of fertilizers to India for the first time in the first half of the 2022/23 fiscal year. It managed to achieve this with the help of discounts compared to prevailing world prices. Reuters reports this with reference to its sources.
According to the publication, the Russians took more than a fifth share of the market, in general, India’s imports of Russian fertilizers increased by 371% to a record 2.15 million tons in the first six months of the year that began on April 1.
Thus, a senior official, who closely monitored the imports, but wished to remain anonymous due to the sensitivity of the issue, said that in value terms, India’s imports during this period increased by 765% to $1.6 billion. During the last fiscal year, India imported 1.26 million tons from Russia.
– India has been struggling to get fertilizers at reasonable prices after the escalation of the conflict between Russia and Ukraine. Supplies from Russia were timely and at reasonable prices. This helped us avoid possible shortages,” the official said.
Fertilizer prices on the world market have jumped since March after Western countries imposed sanctions for the invasion of Ukraine against fertilizer supplies from Russia and Belarus, which were previously key exporters of the product.
Together, Russia and Belarus accounted for more than 40% of global potash exports last year. Russia accounted for about 22% of world exports of ammonia, 14% of world exports of urea and about 14% of monoammonium phosphate (MAP) – all major types of fertilizer.
– It was a win-win situation for India and Russia. India sometimes received discounts of more than $70 per tonne compared to world prices. Russia got a major buyer that can replace European buyers,” said a senior industry official who negotiates with foreign suppliers on behalf of Indian buyers.
In June, India received diammonium phosphate (DAP) from Russia at $920-925 per tonne on a cost and freight (CFR) basis, while other Asian buyers paid more than $1,000, industry officials said.
The surge in shipments from Russia halved China’s exports to India to 1.78 million tonnes in the first half of 2022/23.
Exports from other countries such as Jordan, Egypt and the United Arab Emirates also declined.
In FY 2021/22, Russia’s share in India’s imports was around 6% and China’s share was 24%.
Russia’s market share jumped to 21% in the first half of 2022/23, surpassing China as India’s largest supplier, the official said.
India’s purchases from Russia have helped not only local farmers, but also other import-dependent countries such as Brazil, Argentina, Malaysia and Indonesia, to contain rising global prices, another industry official told New Delhi.
World prices could rise further if India also switched from Russia to other suppliers like China and Morocco, which have limited supplies for export, he said.
