Saturday, June 28, 2008

Fertiliser shortage hits India's farms

From the BBC News;
Increasingly many countries across the world are beginning to recognise that expensive fertilisers, or even a supply shortage, is not just a problem for the farmers.

It has a direct effect on the cost and availability of food. Across the world countries are looking at farmers to produce a bumper crop this year to overcome global food shortage. As fertiliser prices go up – food prices go up as well, threatening to force millions of poor people into starvation.

Back on the farms, Mr Sehrawat is still waiting for his supply.

"It is really urgent that we get our supplies," he says.

"You can wait for monsoons - that's not under anyone's control - but you can't be made to wait for fertilisers.

"At this rate, people have to keep waiting for rice on their plates. Nothing is going to grow on our fields."

With general elections next year, the government in India could suffer the political consequences of poor agriculture output.

And the anger of unhappy farmers who cannot reap the benefits of a good monsoon.
It's always the details that come around to bite really, really hard. Fertilizer - as we all know - is a petrochemical dependent on natural gas feedstocks.
India consumes millions of tonnes of fertiliser each year.

Production costs have risen on the back of soaring crude oil prices.

Globally fertilizer rates have tripled in the last year.

Prices of the three main fertilizers, nitrogen, potash and phosphate, have gone up by almost 300%.

Diammonium phosphate costs nearly $1,300 (£650) per tonne whereas farmers in India pay around $250.

The Indian government subsidises the price by nearly 85% for farmers, which in turn means India's subsidy bill is getting bigger each year. At the current forecasts it amounts to almost 2.5% of the country's gross domestic product.