India’s agricultural success has always been intertwined with the timely availability of fertilisers. Nutrients such as Nitrogen (N), Phosphorous (P), Potassium (K), and Sulphur (S) are indispensable for plant growth, and their demand surges with every good monsoon. Yet, paradoxically, even as the country claims self-reliance and sufficient supply, many Indian states are facing an acute shortage of urea and other fertilisers. This crisis has unfolded at a time when the monsoon has been generous, acreage under cultivation expanded, and the government’s fertiliser subsidies have reached record levels. The contradiction between claims of comfortable supply and the reality of scarcity at the ground level reveals deep-seated issues in India’s fertiliser management, production, distribution, and policy structure.
Fertilisers are concentrated inorganic sources of plant nutrients applied in small quantities to enhance soil fertility. They are classified into sole fertilisers—nitrogenous (urea, ammonium sulphate), phosphatic (single super phosphate), and potassic types (muriate of potash); mixed or complex fertilisers supplying two or more primary nutrients, such a di-ammonium phosphate (DAP) (18:46:0), nitrophosphate (20:20:0) and various NPK grades; and micronutrient fertilisers that provide trace elements like zinc, iron, copper, and manganese through chelated compounds (Zn-EDTA, Fe-EDTA) or inorganic salts.
A Season of Abundance and Rising Demand
The southwest monsoon of 2025 has been exceptional. Cumulative rainfall between June and August stood 6.17 per cent above the historical average, with 33 out of 36 meteorological subdivisions recording normal rainfall. This timely and well-distributed rain encouraged farmers to plant aggressively. By late August 2025, rice sowing had expanded to 420.4 lakh hectares, 7.6 per cent higher than the previous year, while maize acreage rose by 11.7 per cent. The overall kharif acreage reflected a robust agricultural season with adequate soil moisture, replenished groundwater tables, and brimming reservoirs.
Such favourable conditions naturally pushed up fertiliser consumption. When rains are good, farmers invest more in nutrients to ensure healthy crop growth and higher yields. Between April and July 2025, fertiliser sales grew in double digits for most nutrients compared to the same period in 2024. Urea, single super phosphate (SSP), muriate of potash (MOP) and complex fertilisers containing N, P, K, and S witnessed strong demand. Even as farmers increasingly shifted from DAP to alternatives like 20:20:0:13 and SSP for balanced fertilisation, the surge in demand was distinctive. Sales of 20:20:0:13 blends touched 69.7 lakh tonnes in 2024–25, making it one of the top-selling fertilisers. However, the corresponding supply failed to keep pace, leading to widespread shortages.
The Supply Crunch
The shortage stemmed from a mismatch between production, imports, and demand.
Domestic urea production during April–July 2025 was 93.6 lakh tonnes, lower than 102.1 lakh tonnes recorded in the same period in 2024. DAP output remained flat at 13.7 lakh tonnes, while only minor increases were recorded in NPKS complexes and SSP. Imports of both urea and DAP also declined due to global disruptions and supply restrictions from China.
As a result, stock levels plummeted. Urea stocks on August 1, 2025 were just 37.2 lakh tonnes, a sharp fall from 86.4 lakh tonnes a year earlier. DAP stocks were down to 13.9 lakh tonnes from 15.8 lakh tonnes, and complexes dropped to 35 lakh tonnes from 47 lakh tonnes, and MOP declined to 6.3 lakh tonnes from 8 lakh tonnes. Only SSP stocks saw a marginal increase, 20.7 lakh tonnes from 20.1 lakh tonnes. These low stocks collided with peak consumption months of July and August 2025, triggering a scramble among farmers to secure essential fertilisers.
Farmers typically apply phosphatic fertilisers, such as DAP at the time of sowing for root establishment, followed by split doses of urea as crops mature. Nitrogen shortages hit hardest in mid-season when crops demand the most urea for growth, while phosphatic shortages affected root establishment and early crop development. Reports from several states showed farmers standing in serpentine queues outside fertiliser outlets, trying to procure even a few bags. The situation was worsened by panic buying, with many purchasing more than immediate requirements, fearing future scarcity.
Shortages across the States
Across India, several states have been hit hard by the ongoing urea shortage, exposing deep gaps between supply and ground-level distribution.
In Uttar Pradesh, farmers have faced long queues, delays, and accusations of black marketing despite official claims of sufficient stock. Demand has far exceeded supply, leaving small cultivators scrambling for fertiliser even as the state government took punitive action, including licence cancellations and FIRs, to curb irregularities.
In Madhya Pradesh, farmers in districts, such as Vidisha, Guna, Harda, and Chhindwara, staged protest over hoarding and inflated prices, with political parties joining the demonstrations amidst mounting rural discontent.
Andhra Pradesh has experienced similar distress. Of the 1.3 lakh metric tonnes (MT) of urea allocated, only 50,000 MT had reached by June 2025. This led to acute shortages in major paddy and groundnut-growing districts like Chittoor, Kurnool, and Guntur. Despite the Centre’s assurance of dispatching additional consignments, the gap between allocation and delivery triggered widespread anxiety.
In Odisha, farmers across the state struggled to procure fertilisers despite the chief minister’s claim that there was no shortage; reports indicated some 70 per cent of farmers in the state were affected. Opposition party workers organised protests in front of the Raj Bhavan in Bhubaneswar, clashing with the police as farmers waited in long lines outside cooperative societies and alleged black-market sale of subsidised urea.
In Telangana, the crisis took a political turn with the ruling party and opposition trading charges over responsibility. The Centre maintained that it had supplied 12.2 lakh MT against a 9.8 lakh MT requirement, attributing the crisis to poor state-level distribution and black marketing.
Haryana, too, reported panic buying and overpricing as dealers sold fertilisers above the subsidised rates amid early rains and changes in distribution channels. The convergence of administrative lapses, logistical delays, and opportunistic hoarding have, thus, created a common picture of distress across multiple states, even as official data continues to project ‘adequate availability’.
Government’s Response and Policy Efforts
The government’s official narrative, however, presented a contrasting picture. According to the Ministry of Chemicals and Fertilisers, the Department of Fertilisers (DoF) had ensured timely and adequate availability through robust planning, enhanced production, and international partnerships.
Between 2013–14 and 2024–25, urea production rose by 35 per cent from 227.15 lakh metric tonnes (LMT) to 306.67 LMT. Combined DAP and NPK production increased by 44 per cent, from 110.09 LMT to 158.78 LMT. Strategic agreements with Morocco and Saudi Arabia secured long-term supplies of DAP and TSP, ensuring 25 LMT and 31 LMT per year, respectively. The government also claims to be using real-time allocation monitoring to minimize diversion.
The government maintained that against a pro-rata requirement of 143 LMT of urea during kharif 2025, 183 LMT was available and 155 LMT had already been sold. Similar surpluses were cited for DAP and NPKS fertilisers, leading officials to conclude that ‘comfortable availability’ had been maintained.
The ministry further pointed to significant subsidies that shield farmers from international price shocks. Urea continues to be sold at a statutorily notified MRP of Rs 242 per 45-kilogram bag, unchanged since 2012, while DAP is available at Rs 1,350 per 50-kilogram due to special packages covering GST, logistics, and import cost fluctuations.
Enforcement actions have also been intensified, with over 1.99 lakh inspections/raids conducted since April 2025, leading to thousands of show-cause notices, licence cancellations, and FIRs against black market operators. Yet, despite these claims, the widespread reports of scarcity and hoarding in multiple states highlight the gap between official statistics and ground-level realities.
The Global Factor
International factors have compounded domestic challenges. The Russia-Ukraine and Israel-Iran conflicts have disrupted global fertiliser supply chains. The Red Sea cable crisis has forced ships to reroute around the Cape of Good Hope, adding over 6,500 kilometres to journeys and delaying shipments, particularly DAP. China’s curbs on fertiliser exports since 2023–24 sharply reduced India’s imports of urea and DAP from 21.5 lakh tonnes and 22.9 lakh tonnes, respectively, in 2023–24 to barely over one lakh tonnes and 8.4 lakh tonnes in 2024–25. This sudden drop in imports coincided with the surge in demand caused by the good monsoon, aggravating the crisis. Although the recent thaw in relations between India and China has raised hopes of resumed supplies, the damage to stock levels during the critical sowing period was already done.
Subsidy Hikes and the Nutrient-Based Subsidy Scheme
Amidst these difficulties, in October 2025, the union government increased the subsidy for non-urea fertilisers under the Nutrient-Based Subsidy (NBS) scheme to Rs 37,952 crore for the 2025–26 rabi season, nearly 55 per cent rise from the previous season. The hike was driven by higher landed prices of key raw materials like phosphoric acid, sulphur and DAP, whose costs rose steeply in global markets. The subsidy for phosphorus was raised to Rs 47.96 per kilogram for the ongoing rabi season from Rs 43.60 per kilogram in the FY26 kharif season, an increase of 10 per cent. From the previous rabi season, the hike has been around 56 per cent. Sulphur’s subsidy increased by 63 per cent from the FY25. These measures aimed to compensate for rising import costs and maintain affordability for farmers. However, nitrogen and potash subsidy rates remained unchanged. Despite these financial measures, availability bottlenecks persisted due to logistical delays, import dependence, and regional imbalances in distribution.
The NBS scheme, in place since April 2010, provides NBS to fertiliser companies which, in turn, sell P-and K-based fertilisers at controlled MRPs. While the scheme ensures affordability, it also indirectly constrains the industry’s flexibility to respond to market fluctuations and regional demand variations.
Structural and Policy Contradictions
The fertiliser sector remains one of the most tightly controlled segments of India’s economy. Urea’s retail price has been frozen since 2012 at Rs 242 per bag, with imports channelled only through state trading enterprises, restricting competition. DAP, too, is capped at Rs 1,350 per bag. These price controls prevent market correction when demand spikes, making fertilisers prone to diversion and black marketing. Moreover, the government’s demand assessment has often lagged behind in actual field realities. In a year when rice and maize cultivation expanded sharply, both being nitrogen-consuming crops, the authorities underestimated urea requirements, focusing instead on maintaining price stability.
Experts argue that excessive control has stifled the fertiliser industry’s responsiveness. Firms have little incentive to expand production or import when retail prices are capped, and profitability depends on government reimbursements. There is a need for decontrol and de-canalisation of urea imports, allowing prices to float within reasonable limits and enabling companies to adjust supply dynamically. The government could maintain a buffer stock for emergency interventions while letting market mechanisms improve availability.
The Road Ahead
India’s fertiliser paradox of simultaneous claims of surplus and widespread shortages stems from the intersection of administrative control, delayed logistics, import dependency, and misaligned incentives. While the government’s long-term agreements and subsidy expansions strengthen strategic self-reliance, their benefits are undermined by inefficiencies in distribution and enforcement at the state level. The presence of serpentine queues, hoarding, and inflated retail prices across states like Uttar Pradesh, Madhya Pradesh, Andhra Pradesh, and Haryana stand in sharp contrast to the Centre’s claims of ‘comfortable availability’.
Resolving this paradox requires more than temporary interventions. Accurate demand forecasting, timely distribution, transparent stock monitoring, and decentralised import mechanisms are crucial. Equally, rationalising subsidies and allowing limited price flexibility could help bridge the chronic gap between policy intent and field reality. Until such reforms materialise, India’s fertiliser sector would continue to mirror the broader contradiction of its agriculture, where abundance at the macro level coexists with scarcity at the grassroots.
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