India to gain as China eases curbs on urea

China has allocated another 7 million tonnes of urea for exports, easing restrictions on the shipment of the crop nutrient further, said people aware of the matter. "Most of this urea will come to India," a person directly involved in the matter told ET on condition of anonymity.

China had halted the shipments of urea and some other fertilisers to India in the past few months, but it has begun the process of easing restrictions on supplies of urea to the country. Before the latest allocation, on Wednesday, it had allocated some quantity of urea for exports and India is expected to receive 2-3 million tonnes from that, according to people with knowledge of the matter.

India and China have commenced discussions on a trade package covering supplies of critical rare earth magnets, fertilisers and other essentials amid heightening tensions with the US on tariff and the clamour from Indian industry to expedite imports of essential inputs from China.


After a significant breakthrough, China conveyed that it has lifted curbs on export of fertilisers, rare earth magnets and tunnel boring machines, bringing relief to farmers during the kharif season, the main planting season for India when farmers sow rice, pulses, oilseeds and maize.

Demand for urea in India has surged as farmers want to ensure their crops have enough nutrients after a good monsoon rainfall, with the country receiving a cumulative rainfall of 2.1% above the long period average till August 20, according to the India Meteorological Department.

Farmers have sown about 39.86 million hectares under rice as of August 15, up from 36.29 million hectares a year ago.

Acreage under maize increased to about 9.28 million hectares from 8.29 million hectares during this period. Both these crops need a significant amount of urea.

But data from the Department of Agriculture and Farmers' Welfare shows that as of August 1, stocks of key fertilisers including urea and di-ammonium phosphate are lower compared with the year-ago figures.