Rough weather, Pg3

Key Highlights:

• The global fertiliser market is experiencing rising prices due to the war, impacting inputs like LNG, ammonia, and sulphur, as well as higher freight costs.
• India's fertiliser expenditure is projected to increase in the coming fiscal year.
• Natural gas supply to Indian fertiliser units, which had decreased to 60%, has now risen to 75-80% amid the West Asia conflict.

Detailed Insights:

• The increase in prices of key inputs such as LNG, ammonia, and sulphur is driven by disruptions in the global supply chain due to geopolitical tensions.
• Reduced natural gas supply impacts the production capacity of fertiliser plants, potentially leading to supply shortages and increased import dependence for India.
• Fluctuations in natural gas supply can affect the availability and affordability of fertilisers for farmers, impacting agricultural productivity and food security.

Key Concepts Involved:

• LNG (Liquefied Natural Gas): Natural gas that has been cooled to liquid form for ease of storage and transportation.
• Ammonia: A compound of nitrogen and hydrogen, used as a building block for many nitrogen fertilisers.
• Fertiliser: A natural or synthetic substance containing chemical elements that improve the growth and productivity of plants.