Due to the acute shortage of fertilizers, farmers in India are turning to the black market and paying large sums for the supply.

Latifundist.com writes about this with reference to the publication Krishi Jagran.

It notes that the shortage has created a thriving market in which subsidized crop nutrients are sold illegally at significantly higher prices than those set by the government.

According to the report, farmers say they have little choice as a crucial planting season begins for millions of Indian families who make a living from agriculture.

According to Dilip Patidar, a wheat and onion grower in Madhya Pradesh, they have to either cut their fertilizer use and risk lower yields, or pay high prices on the black market.

According to him, any of these alternatives are not very good. In a country where 15% of the population is undernourished, declining agricultural production could push up food prices, exacerbating inflation. Paying high prices on the black market will hurt the incomes of India's small and land-poor agricultural producers, who account for more than 80% of the country's agricultural industry.

“India is one of the countries hardest hit by fertilizer shortages in the world. Crop nutrient prices have risen due to limited supplies of coal and natural gas, which has forced some fertilizer companies in Europe to close. China and Russia have also restricted exports to protect domestic supplies. These obstacles will keep fertilizer prices high until the first half of 2022, according to Gro Intelligence.

According to Bloomberg Intelligence analyst Alexis Maxwell, India will be the first to feel the blow, as demand for fertilizers in this country peaks in the fourth-first quarter.

China, one of the main suppliers of fertilizers to India, has imposed export restrictions, she said, leaving the South Asian country lacking alternatives to supply fertilizers.

It is noted that India imports over a third of its fertilizers and is the world's largest buyer of urea and DAP (diammonium phosphate). The supply shortage will certainly negatively affect the yields of the main winter crops, including wheat, rapeseed and pulses.

"The fertilizer shortage has arisen at a time when the prices of other inputs such as fuel are also rising and some farmers have been hit by irregular rainfall," said an economist at Mumbai-based Elara Securities (India) Pvt. Ltd. Garima Kapoor.

India is increasing its own fertilizer production and is entering into long-term agreements with suppliers to contain price increases, according to various sources. The current subsidies from fertilizer companies are sufficient, but if more is needed, the government will provide them.

According to one source, the federal government has begun distributing fertilizers to districts on a weekly basis based on demand so that retailers and farmers do not stock up on them.

It is noted that a 45-kilogram bag of diammonium phosphate is currently on sale for Rs 1,500 ($ 20) on the black market, higher than the maximum retail price of Rs 1,200 ($ 15.92).

SuperAgronom.com