The Fertilizer Challenge Amid the Iran War

What is the Fertilizer Challenge?

• The fertilizer challenge refers to India’s vulnerability to disruptions in fertilizer imports and energy supplies caused by geopolitical tensions in West Asia.
• The Persian Gulf is the main route for finished fertilizers as well as Liquefied Natural Gas (LNG), which is used as feedstock for domestic urea production.
• When maritime routes such as the Strait of Hormuz are disrupted, India faces both higher import prices and reduced domestic production.
• This directly affects agricultural productivity, food prices, and government subsidy expenditure.

India’s Dependence on Fertilizers

• India annually consumes nearly 39–40 million tonnes of urea, making it the most important fertilizer for Indian agriculture.
• Urea is critical for staple crops such as rice, wheat, maize, and sugarcane because it provides nitrogen, which is essential for plant growth.
• The Green Revolution model of Indian agriculture is highly fertilizer-intensive, and any disruption in fertilizer supply directly affects crop yields and food security.
• India also imports large quantities of DAP (Di-Ammonium Phosphate), MOP (Muriate of Potash), sulphur, and ammonia for balanced nutrient supply.
• Heavy subsidy support for urea has led to overuse of nitrogen and an unhealthy NPK imbalance, making the agricultural system excessively dependent on cheap urea.

How the Iran War Affects India’s Fertilizer Supply

Strait of Hormuz as a Critical Chokepoint

1. The Strait of Hormuz is about 33 km wide at its narrowest point, with shipping lanes only ~3 km wide in each direction.
2. It carries around 17–20 million barrels of oil per day, nearly one-fifth of global petroleum consumption.
3. Major exporters using this route include Saudi Arabia, Iraq, United Arab Emirates, Kuwait, and Iran.
4. It is the only sea passage connecting the Persian Gulf with the open ocean through the Gulf of Oman.
5. It is bordered by Iran to the north and Oman (Musandam Peninsula) to the south.
6. A significant share of global LNG exports, especially from Qatar, also passes through this strait.

LNG Supply Disruption

• India’s domestic urea plants use natural gas as the main feedstock, and much of this LNG comes from Gulf countries such as Qatar and Oman.
• Because LNG shipments were disrupted, domestic urea production dropped from the normal 2.5 million tonnes per month to nearly 1.5 million tonnes in March 2026.
• This means India is facing both import shortages and reduced domestic production simultaneously.

Raw Material Shortage

• India also depends on Gulf countries for raw materials such as ammonia and sulphur used in DAP and other fertilizer manufacturing.
• Their prices have sharply increased, with ammonia and sulphur crossing $900 per tonne.
• This raises production costs even when final fertilizers are produced domestically.

Fertilizer Import Dependence and Supply Shock

• The Gulf Cooperation Council (GCC) countries including Oman, Qatar, Saudi Arabia, UAE, and Bahrain account for nearly 40% of India’s urea imports and over 60% of its LNG imports.
• For Kharif 2026, India requires nearly 19.4 million tonnes of urea, but opening stocks were only 5.5 million tonnes.
• Urea import bids increased dramatically from $510 per tonne in February to nearly $950 per tonne in April 2026 due to the Hormuz blockade.
• This sharp rise reflects panic buying, shipping risks, and severe supply uncertainty.
• Even if Kharif requirements are somehow managed, the Rabi season remains highly vulnerable if supply lines are not restored.

Government Response and Immediate Measures

Emergency Tendering

• Indian Potash Limited (IPL) issued a large tender for 2.5 million tonnes of urea in April 2026 to secure supplies before peak sowing begins.
• This is aimed at preventing shortages during Kharif operations.

Diversification of Import Sources

• India has started shifting procurement of ammonia and DAP toward countries such as Morocco, Jordan, Indonesia, and Malaysia to reduce excessive Gulf dependence.
• This diversification helps reduce strategic vulnerability.

Extension of Import Timelines

• The government extended loading deadlines for fertilizer imports because many vessels were delayed near conflict zones and maritime chokepoints.
• This prevents cancellation of import contracts.

Promoting Alternatives

• Farmers are being encouraged to use Single Super Phosphate (SSP) and Triple Super Phosphate (TSP) as substitutes for scarce DAP.
• This helps reduce pressure on imported phosphatic fertilizers.

Major Challenges Associated with the Crisis

• The biggest challenge is that the Strait of Hormuz is a physical maritime chokepoint, and ships cannot move if the route remains blocked.
• Even high prices cannot solve this problem immediately.
• The sharp increase in fertilizer prices creates a massive rise in the fertilizer subsidy burden for the Government of India, putting pressure on fiscal stability.
• War-related insurance premiums and freight costs have increased sharply, and many shipping companies are reluctant to enter the region.
• Domestic fertilizer plants are operating only at partial capacity because LNG shortages reduce production efficiency.
• Shortages also create risks of hoarding, black marketing, and unequal access, especially harming small and marginal farmers.

Significance for Indian Agriculture

• Fertilizer availability directly determines crop productivity, especially for food grains such as rice and wheat.
• Any shortage during sowing seasons can reduce yields, create food inflation, and weaken national food security.
• The crisis also highlights how India’s food security is closely linked to global energy security because fertilizers depend heavily on imported gas and raw materials.
• The issue affects fiscal management because fertilizer subsidies are one of the largest agricultural support expenditures of the Union Government.
• This crisis is therefore not only an agricultural issue but also a strategic and economic challenge.

Way Forward

Fertilizer fortification should be expanded by coating urea and DAP with micronutrients such as zinc and boron so that less fertilizer produces better yields.

Nano Urea and Nano DAP should be rapidly scaled up because foliar spray reduces dependence on bulk fertilizer imports and improves nutrient-use efficiency.

Biostimulants such as microbial inputs and seaweed extracts should be promoted to reduce chemical fertilizer dependency.

Phosphate Solubilizing Bacteria should be used to unlock phosphorus already present in the soil and reduce immediate DAP demand.

Conclusion

The Iran war has exposed the fragile connection between India’s energy security and food security.

A conflict in West Asia can directly influence fertilizer availability for Indian farmers and therefore determine crop output and food prices.

While emergency imports may help manage the Kharif season, the real long-term solution lies in nutrient-efficient fertilizers, domestic resilience, and strategic diversification.

Ensuring fertilizer security is essential for protecting both farmers and national food stability.