Fertiliser sales see sharp dip as El Nino dries up farm demand

Complex fertilisers recorded the sharpest sales decline during April-September 2026. Sales fell 22.2% from the same period in 2025. Muriate of potash, or MOP, followed with an 11.7% drop. These fertilisers supply several nutrients, so their sales can reflect broader decisions about crop planting and farm input use.

Sales of DAP and single super phosphate were almost stable, falling only 0.6% and 1.4%. The sharper declines in complexes and MOP suggest farmers were buying less where planting conditions were especially poor or where prices were less attractive. Complex fertilisers also faced supply problems caused by scarce, expensive sulphur.

The wider pattern points to subdued demand rather than a general shortage alone. Countrywide southwest monsoon rainfall was 12.6% below normal, with severe shortfalls in several farming regions. Lower rainfall reduced farmers’ need or willingness to purchase fertiliser, while DAP’s controlled MRP helped keep its sales comparatively steady.

Fertiliser sales generally weakened during April-September 2026 compared with the same period in 2025. Complex fertiliser sales fell 22.2%, MOP sales dropped 11.7%, DAP sales slipped 0.6%, and SSP sales declined 1.4%. Urea sales also fell 4.1%, despite its importance and availability.

Urea supply moved in the opposite direction. Domestic production increased 4.3%, while imports jumped 40.5%. The government supported this rise by pushing companies to secure more liquefied natural gas and by encouraging direct international urea imports. This helped prevent a physical shortage.

The contrast is significant. Farmers were not buying less urea because supplies had disappeared. They were buying less because poor rainfall reduced crop demand and the incentive to stock up. Urea sales fell for the first time since 2021-22, after reaching 39.6 million tonnes in 2025-26. The figures show demand weakness overriding increased availability.

El Niño is a recurring climate pattern in which surface waters in the central and eastern tropical Pacific Ocean become unusually warm. This warming changes atmospheric circulation across the world. The altered circulation can shift or weaken normal rain-producing systems over South Asia.

For India, a strong El Niño is commonly associated with weaker or less evenly distributed southwest monsoon rainfall. The mechanism is indirect: warmer Pacific waters influence winds, pressure patterns and the movement of moisture. This can reduce the moisture reaching parts of India during the main monsoon season. The article links the present event with deficient rains and dry weather.

The reported effects were already visible in the data. India’s June-September rainfall was 12.6% below its long-period average, while October had a 51.8% deficiency so far. Weather agencies expected the El Niño to remain strong to very strong through January-March 2027. Such conditions can reduce planting and fertiliser demand.

Urea became more available, but farmers had less reason to purchase it. Production increased 4.3% and imports rose 40.5% during April-September 2026 compared with the previous year. Government efforts to secure liquefied natural gas also supported domestic manufacturing and helped avoid a physical shortage.

The key mechanism was weak rainfall. Poor rains across southern states, parts of Maharashtra and Gujarat, Rajasthan, south Bihar and Assam reduced crop activity and fertiliser demand. In the previous year, some farmers paid Rs 350-450 for a 45-kg urea bag on the black market and stocked up. This year, prices stayed within Rs 300 because supplies were available and farmers felt less urgency.

As a result, urea sales fell 4.1%, the first decline after 2021-22. Sales also dropped from the record 39.6 million tonnes recorded in 2025-26. If dry conditions continue, fertiliser demand could remain subdued despite government efforts to maintain supplies.

War-related disruption affected fertiliser inputs in two ways. Gas supplies used by domestic urea manufacturers were threatened after supplies from Qatar and the UAE dwindled. Companies therefore sought liquefied natural gas from countries including the US, Nigeria, Oman, Angola, Cameroon, Australia and Norway.

Sulphur was an even more direct problem for complex fertilisers. Sulphur is needed to manufacture phosphorus-containing complexes and SSP. India had imported much of it from facilities linked to Saudi Aramco, QatarEnergy and Abu Dhabi National Oil Company. Those facilities suffered damage from Iranian missile and drone attacks. Import prices rose sharply to $1,000-1,100 per tonne, from $300-400 a year earlier.

Domestic production of complex fertilisers fell 35.5%, while SSP production dropped 10.4% during April-September 2026. Complex fertiliser MRPs were about Rs 2,100 for one grade and Rs 2,400 for two others. Higher input costs and constrained supply therefore pressured both production and prices.

Rabi crops are planted for the winter-spring season, so they depend on farmers having suitable soil moisture and workable growing conditions after the monsoon. A drier and warmer winter could make farmers more cautious about planting. It could also reduce the area planted or weaken crop prospects.

The mechanism is straightforward. Subpar winter precipitation would leave less water available for germination and crop growth. Higher-than-usual temperatures could increase crop stress and raise irrigation needs. With less confidence in yields, farmers may reduce purchases of fertilisers, particularly where applying nutrients would not produce enough crop growth.

The article says most global weather agencies expected the current El Niño to remain strong to very strong through January-March 2027, before weakening toward April-May. This creates a risk that rabi planting and fertiliser demand will remain subdued. The actual impact will depend on winter rainfall and temperatures across farming regions.

Nitrogen, phosphorus, potassium and sulphur are essential plant nutrients. Nitrogen supports leafy growth and is part of chlorophyll and proteins. Phosphorus helps plants develop roots and supports energy transfer. Potassium regulates water balance and strengthens plants. Sulphur is needed for certain proteins and enzymes. These roles make balanced nutrition important for crop growth and yields.

The nutrients work together rather than serving identical purposes. A crop may need nitrogen for vigorous leaves, phosphorus for roots and early development, potassium for stress regulation, and sulphur for protein formation. If one nutrient is seriously short, the plant may not use the others efficiently. Fertilisers combine these nutrients in different ratios to match crop and soil needs.

The article illustrates the practical importance of sulphur. Without it, manufacturers cannot produce phosphorus-containing complex fertilisers or SSP. Sulphur shortages cut complex fertiliser production by 35.5% and SSP production by 10.4%. This can restrict farmers’ access to balanced nutrients, even when demand exists.