Indian government and industry experts confirmed that the escalating conflict in West Asia poses a “grim” and “immediate” threat to India’s fertilizer supply chain. With the Strait of Hormuz effectively closed to commercial traffic and the Red Sea under constant threat, India—the world’s second-largest fertilizer consumer—is facing a potential shortage of key nutrients just as preparations for the Kharif (summer) sowing season begin.
The “Fertilizer Chokepoint” Crisis
India relies on the Persian Gulf for a massive share of its finished fertilizers and the raw materials used to manufacture them domestically.
- Hormuz Dependency: Approximately 60% of India’s fertilizer imports transit the Strait of Hormuz.
- Urea & LNG Squeeze: Nearly 46% of India’s urea comes from Oman alone, with Saudi Arabia and Qatar being other top suppliers. Furthermore, 30 out of 32 Indian urea plants use Natural Gas as feedstock; with Qatar pausing LNG production due to the conflict, domestic manufacturing is at risk of stalling.
- DAP & Potash: Gulf countries supply over 60% of India’s DAP (Diammonium Phosphate) requirements. Specifically, Oman (39.5%), Qatar (14.7%), and the UAE (10.7%) are the primary lifelines for this essential nutrient.
- Sulphur Shortage: Qatar, the UAE, and Oman collectively account for 76% of India’s sulphur imports, a critical input for producing phosphate-based fertilizers.
Immediate Market Impact (March 2026)
The disruption has already triggered a “price shock” across the agricultural sector:
- Shipping Costs: Freight rates for bulk shipments have doubled, with emergency conflict surcharges of $2,000 to $4,000 per container being levied by global shipping giants.
- Import Costs: The combined rise in energy, insurance, and logistics has increased the landed cost of fertilizers in India by 25–30% in just one week.
- Suspended Offers: Many Middle Eastern producers have suspended new offers for urea and ammonia, focusing only on trying to deliver existing contracts that are now trapped behind the blockade.
Government Contingency: “Record High Stocks”
To prevent a panic among farmers, the Department of Fertilizers issued a reassuring statement on March 6, 2026, outlining India’s current safety net:
| Fertilizer Type | Current Stock (March 2026) | Previous Year (March 2025) | % Increase |
| Urea | 59.3 Lakh Tonnes | 49.0 Lakh Tonnes | +21% |
| DAP | 25.1 Lakh Tonnes | 13.0 Lakh Tonnes | +93% |
| NPKS Complexes | 55.8 Lakh Tonnes | 32.0 Lakh Tonnes | +74% |
| Total Reserves | 177.3 Lakh Tonnes | 129.8 Lakh Tonnes | +36.5% |
- Pre-emptive Imports: The government fast-tracked the import of 98 lakh tonnes of finished fertilizers through February to build this record-high buffer.
- Gas Allocation: Fertilizers have been moved to “Top National Priority” for natural gas allocation, even ahead of some industrial sectors, to keep domestic plants running.
- Maintenance Shifts: Fertilizer companies have agreed to move up their scheduled plant shutdowns to March, allowing them to perform maintenance now while shipping is disrupted so they can run at 100% capacity when the Kharif season peaks in June.
The Long-Term Risk
While the current 177 lakh tonnes of stock can protect the country for several weeks, a prolonged conflict (extending beyond April) could lead to:
- Subsidy Ballooning: The government’s fertilizer subsidy bill, already pegged at ₹1.26 trillion, will likely need a massive mid-year infusion to keep retail prices stable for farmers.
- Kharif Uncertainty: If LNG and raw material shipments don’t resume by May, the sowing of rice, pulses, and cotton could see significant yield drops due to “under-application” of nutrients.
