India imported 32 lakh tonnes of urea and DAP in the first quarter of FY26 to supplement domestic production. The government is securing long-term supply deals with nations like Saudi Arabia and Russia to reduce dependence on China and manage global supply chain volatility.
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India secured 32.19 lakh tonnes of essential fertilisers between April and June 2026, according to official data presented in the Lok Sabha. The imports, comprising 25.08 lakh tonnes of urea and 7.11 lakh tonnes of di-ammonium phosphate (DAP), were used to supplement domestic production levels, which reached 115.72 lakh tonnes during the same three-month period. This effort ensures that the country maintains enough inventory to meet the requirements of the agricultural sector.
The government is focused on long-term procurement to stabilise the availability of critical nutrients. Minister of Chemicals and Fertilizers J.P. Nadda noted that the Department of Fertilizers is working with Indian diplomatic missions globally to find reliable alternative supply sources. By moving away from a dependence on single-source suppliers, the administration aims to protect the domestic market from sudden shortages or price spikes caused by international trade tensions.
Strategic shifts are already visible in the sourcing of specialty fertilisers. With China restricting certain exports, Indian firms have successfully redirected their procurement toward providers in Europe, North Africa, and the United States. This diversification includes increased trade for water-soluble fertilisers from markets like Belgium, Egypt, and Germany.
Long-Term Import Agreements
To create a more predictable supply environment, the government has formalised multi-year agreements with key international partners. A major deal with Saudi Arabian entities covers the annual delivery of approximately 31 lakh tonnes of DAP. Additionally, agreements with Russian suppliers for this fiscal year total 26.50 lakh tonnes of DAP and NPK fertilisers, alongside a combined 4.80 lakh tonnes of muriate of potash from Russia, Germany, and Turkmenistan. These agreements are designed to lock in supply volumes despite potential fluctuations in the global market.
For investors and market observers, the primary factor to track will be the landed cost of these imports relative to domestic retail pricing policies. While long-term agreements provide supply security, the financial impact on fertiliser companies depends on the government's subsidy mechanism, which balances the cost of imported raw materials and finished goods against fixed retail prices for farmers. Investors may also monitor future updates on domestic capacity expansion, as higher local production would eventually reduce the structural need for large-scale imports. The successful execution of these international supply contracts will remain a key monitorable to ensure there are no interruptions during peak sowing seasons.