Lok Sabha Question No. 905 (UNSTARRED), answered on 2025-02-07
Subject: Capacity of Storage Houses
Ministry: CHEMICALS AND FERTILIZERS
Asked by: Shri Dilip Saikia, Shri Lumbaram Choudhary, Smt. Shobhanaben Mahendrasinh Baraiya, Smt. Kamlesh Jangde

## GOVERNMENT OF INDIA MINISTRY OF CHEMICALS AND FERTILIZERS

## DEPARTMENT OF FERTILIZERS

## LOK SABHA

UNSTARRED QUESTION NO. 905 TO BE ANSWERED ON

: 07.02.2025

## Capacity of Storage Houses

905. SMT. KAMLESH JANGDE:

SHRI DILIP SAIKIA:

SMT. SHOBHANABEN MAHENDRASINH BARAIYA:

SHRI LUMBA RAM:

Will the Minister of CHEMICALS AND FERTILIZERS be pleased to state:

- (a) whether  the  Government  has  devised  any  plan  to  deal  with  the  sharp fluctuations  in  international  prices  and  uncertainty  in  the  availability  of  raw materials used for manufacturing fertilizers;
- (b) if so, the details thereof;
- (c) whether the storage capacity of the existing storage houses for raw materials is  sufficient  to  ensure  uninterrupted  availability  of  raw  materials  to  the fertilizers plants;
- (d) if  not,  whether  the  Government  is  working  on  any  plan  to  increase  the capacity of the said storage houses in future; and
- (e) if so, the details thereof?

## ANSWER

THE MINISTER OF STATE IN THE MINISTRY OF CHEMICALS & FERTILIZERS

## (SMT. ANUPRIYA PATEL)

(a) & (b): In respect of Urea, natural gas is mainly used as a feedstock by all urea units for the production of urea. Presently, all units have gas pipeline connectivity and use natural gas for urea production. The cost of natural gas including taxes on it are pass through item for the calculation of the subsidy on Urea produced by the units.  Accordingly,  the  impact  of  the  fluctuation  in  the  price  of  natural  gas  is  not passed on the farmers as the price of Urea is fixed at a statutorily notified Maximum Retail Price (MRP) of Rs. 242 per 45 kg bag (exclusive of charges towards neem coating and taxes as applicable). The difference between the delivered cost of Urea at farm gate and net market realization by the Urea units is given as subsidy to the Urea manufacturer/importer by the Government of India. Accordingly, all farmers of the  country  are  being  supplied  Urea  at  the  subsidized  rates  and  thereby  are beneficiaries of this scheme.

In  respect  of  Phosphatic  &  Potassic  (P&K)  fertilizers,  Government  has implemented  Nutrient  Based  Subsidy  (NBS)  Policy  w.e.f.  01.04.2010.  Under  the policy, a fixed amount of subsidy, decided on annual/bi-annual basis, is provided to manufacturer  /  importer  on  subsidized  P&K  fertilizers  depending  on  their  nutrient content  i.e.  Nitrogen  (N),  Phosphorus  (P),  Potassium  (K)  and  Sulphur  (S)  to improve  availability  of  fertilizers  to  farmers.  P&K  fertilizers  are  decontrolled  and companies are free to import / produce fertilizer raw materials, intermediaries and finished  fertilizers  as  per  their  business  dynamics.  In  view  of  price  volatility  in international prices of key fertilizers and raw materials, the Government subsumes fluctuations, if any, while fixing NBS rates for P&K fertilizers bi-annually.

The Government of India has actively engaged with countries rich in fertilizer raw materials  and facilitated the establishment of several Long-Term Agreements (LTAs) between Indian companies and foreign companies in fertilizer rich countries. Additionally, the Indian fertilizer companies have also formed Joint ventures (JVs) in fertilizer-rich nations, such as Oman India Fertilizers Company (OMIFCO) in Oman, Industries  Chimiques  Du  Senegal  (ICS)  in  Senegal,  and  Jordan  India  Fertilizers Company (JIFCO) in Jordan.  The list of  JVs is attached as Annexure . These Joint Ventures and Long Term Agreements aim to ensure a steady supply of fertilizers and strengthen cooperation in the global fertilizer sector.

(c)  to  (e): The  capacity  of storage of raw materials and intermediates, such as, rock  phosphate,  sulphur,  phosphoric  acid,  sulphuric  acid  and  ammonia  for  the production of fertilizers are designed at the planning stage before commissioning of plant.  The optimum capacity of raw materials and intermediates are decided based on various factors including (but not limited to) daily capacity of the plant, availability of  raw  materials  in  the  international  &  domestic  markets,  location  of  the  plant, inventory cost, recovery cycle from the market, etc.  The storage capacity is also adequately increased in case a plant revamps its capacity of finished product. The storage capacity of various raw materials is optimized to meet the production rate for 15 up to 60 days. In case of natural gas, there is no need for storage as it is supplied through gas pipelines by gas suppliers.

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## Annexure

## Annexure referred to in reply to part (a) & (b) of Lok Sabha Unstarred Question No. 905 for answering on 07.02.2025

## List of Joint ventures formed by Indian Fertilizer Companies abroad

|   Sl. No. | Joint Venture                                          | Participating companies                                                                              |
|-----------|--------------------------------------------------------|------------------------------------------------------------------------------------------------------|
|         1 | Jordan Phosphate Mining Company (JPMC) - Jordan        | JPMC (48%), IFFCO (27% equity) & Kisan International Trading (25%) (IFFCO's wholly owned subsidiary) |
|         2 | Indo Maroc Phosphore SA (IMACID), Morocco              | OCP SA- Morocco, Chambal & Tata Chemicals Ltd. (TCL)- 33.33% each shareholding                       |
|         3 | Oman India Fertilizers Co. (OMIFCO), Oman              | Oman Oil Co. (OOC- 50%) IFFCO (25%) & KRIBHCO (25%)                                                  |
|         4 | Baobab Mining and Chemical Corporation (BMCC), Senegal | Coromandel Chemicals Ltd. is having 45% shareholding in BMCC.                                        |
|         5 | ICS Senegal, Senegal                                   | Indorama Corporation (78%), IFFCO (6.78%) and GoI (0.22%)                                            |
|         6 | Tunisia, India Fertilizer Company (TIFERT) Tunisia     | GCT, CPG (Tunisia-70%), CIL (15% equity) & GSFC (15% equity)                                         |
|         7 | Foskor, South Africa                                   | CIL holds 14% sweat equity in Foskor.                                                                |
|         8 | Karnalyte Resources, Canada                            | GSFC holds a 47.73% ownership stake in Karnalyte,                                                    |

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