Iran war: Agrochemicals stress and inflation worry, Pg19

Key Highlights:

• As of March 1, 2026, India has ample wheat (23.6 million tonnes) and milled rice (36.5 million tonnes) stocks in government warehouses.
• A surplus monsoon in 2025 has led to increased planting of rabi crops like wheat, mustard, maize, and chana.
• The Iran War has disrupted imports of fertilisers and raw materials from the Gulf Cooperation Council (GCC) countries.
• Prices of imported ammonia, sulphur, and DAP (Di-ammonium phosphate) have significantly increased due to the war.
• The war is causing supply chain disruptions for naphtha, a key feedstock for agrochemicals, potentially increasing production costs.

Detailed Insights:

• India's current food stock situation is comfortable due to good harvests and existing reserves, similar to the respite provided by agriculture during the 2020 COVID-19 pandemic.
• Favorable weather conditions, including rains from western disturbances, have benefited the wheat crop, allowing for better grain filling and higher yields.
• Disruption in fertiliser imports could impact the upcoming kharif season, necessitating recalibration of nutrient-based subsidy rates.
• Maximizing domestic production of complex fertilisers and SSP (Single Super Phosphate), along with promoting balanced fertilisation, is crucial.
• The agrochemical industry faces challenges due to increased costs of raw materials like naphtha and packaging materials, potentially affecting crop protection and food prices.

Key Concepts Involved:

• Rabi Crops: Crops sown in winter and harvested in the spring.
• Kharif Crops: Crops sown in monsoon and harvested in the autumn.
• Nutrient-Based Subsidy: A subsidy scheme by the government to provide fertilizers at affordable rates.

Nutrient Based Subsidy scheme