Chem Ferti Final Ppt - Copy

8/3/2019 Chem Ferti Final Ppt - Copy

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BY-

GROUP-1


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India is the third largest producer and 2nd largestconsumer of fertilizer in the world.

The private sector produced 44.73 % ofnitrogenous fertilizers and 62.08 % of phosphatic

fertilizers in 2006-07.

Total production of fertilizers in india-206.5mt .

The production of urea in India has reached nearself-sufficiency.


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The requirement of the nitrogenous fertilizers ismet through the indigenous industry

In the case of phosphatic fertilizers, the rawmaterials and intermediates are imported in largescale.

The requirement of potash (K) is met entirelythrough imports.


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No fertilizer unit of India has any reserve of

potash. 65 large-sized fertilizer plants in India .

32 units-urea

20 units-DAP & complex fertilizers 13 units-ammonium phosphate & CAN


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Started in 1906 with SSP productionfacility at Ranipet near Chennai.

Started operating in a big scale since1940s, when the Fertilizer & ChemicalsTravancore of India Ltd. and the

Fertilizers Corporation of India were setup in Kerala and Bihar


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Pre Liberalization

Post Liberalization

-Phase 1: 2000-01 and 2001-02

-Phase II (2002-03-2003-04)

-Phase III (2004-05-2006-07)

W T O Implications


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Most companies are expecting approval fortheir huge capital expenditure plans fromdepartment of fertilizer and industry

Indian fertilizer companies joined hands with

Jordan, Senegal, Oman, Morocco, Egypt etc The demand for fertilizer has increased by

5% (21 June 2010, Rashtriya Chemicals and

fertilizer) 10% increase in Urea price in April 2010

Fertilizer subsidy has taken largest share for58.7% of total subsidies in 2008-09


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The Fertilizer Industry in India started its firstmanufacturing unit of Single Super Phosphate(SSP) in Ranipet near Chennai with a capacity

of 6000 MT a year. Total capacity of the industry has reached a

level of 121.10 lakh MT of nitrogen (inclusive ofan installed capacity of 208.42 lakh MT of urea

after reassessment of capacity) and 53.60 lakhMT of phosphatic nutrient.


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The Indian fertilizer industry has a capacity of56 lakh MT of phosphatic nutrient and 121 lakh

MT of nitrogen. While the private sector has a huge installed

capacity for phosphatic fertilizers, capacityutilization of nitrogenous fertilizers is higher in

the public sector.


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Sector-wise, Nutrient-wise Installed FertilizerManufacturing Capacity as on 31.01.2007-

63 large units dedicated to the production offertilizers.

9 units produce ammonium sulphate while 38units produce urea.

79 small and medium scale units producingsingle superphosphate.


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Import of urea, DAP & MOP 6.61, 7.41, 6.36

Mte Retail prices of urea increased from Rs.4830/-

per tonne during 2009-10 to Rs.5310/- per

tonne during 2010-11 P & K as per NBS Policy, retail prices were

opened & market driven

NPK use ratio changed from 4.3:2:1 (2009-10) to

5:2.4:1(2010-11)


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P

RODUCTION

(Mte)

MODEST INCREASE IN DOMESTICPRODUCTION

HIGH IMPORTS

IMP

ORTS

(Mte)


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HIGH GROWTH IN CONSUMPTION

CONS

UMPTION

(MTe)


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Determinants of fertilizer demand are:-

Rainfall and irrigation facilities Relative prices of fertilizers

Cropping pattern

Government policy National Income & Growth


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India's demand for fertilizers in 2007-08 was 26MM tons, which went up to 29 MM tons in 2008-09

against a supply of 20 MM tons in 2008-2009. The demand for fertilizers in 2011-12 is forecasted

to be around 35.5 MM tons.

More fertilizer projects are in the pipeline.

Gujarat is expected to play a leading role infertilizer production.

Indian companies have penetrated the overseasmarket, signaling a new phase for the industry.

The per hectare consumption of fertilizers innutrients terms increased from 105.5 kg in 2005-06to 128.6 kg in 2008-09.


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Undertaking inspection and analysis ofimported and indigenous fertilizers

Standardization and development of method

of analysis Training of fertilizer enforcement officers and

analysts.

Acting as a referee laboratory

Providing technical guidance to the Centraland State governments on Fertilizer QualityControl Laboratories.

Fertilizer movement control order(1973)


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FERTILISER CONTROL ORDER 1957

FERTILISER MOVEMENT CONTROL ORDER 1973

RETENTION PRICE SCHEME 1977

BLOCK DELIVERY SCHEME 1980-81

JOINT PARLIAMENT COMMITTEE ONFERTILISER PRICING 1991

FERTILISER PRICING POLICY 1997 NORMATIVE REFFERAL PRICE (BASED ON

LONG RUN MARGINAL COST) 1997-98


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BUREAU OF INDUSTRIAL COSTS & PRICES1998-99

NEW PRICING SCHEME 2002 FERTILISER MONITORING SYSTEM 2007

USE OF CUSTOMISED FERTILISER (ADDTLCLAUSE IN FCO,1985) 2008

FREIGHT SUBSIDY 2008

NBS 2010

SECONDARY & MICRONUTRIENT (B,ZN)

2010 FEEDBACK STOCK POLICY 2011


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Farm gate price of urea is amongst the lowestin the region and is heavily subsidised.

Retention price of controlled fertilizers isfixed in every 3 years.

1992-govt. decontrolled import of complexfertilizers (DAP & MOP).

For each decontrolled fertilizer, the

Maximum Retail Price (MRP) is indicated byCentral Government except for Single SuperPhosphate, the MRP of which is indicated byeach State/UT Government.


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NBS policy on decontrolled Phosphoric and

Potassic fertilizer w.e.f 1 st April ,2010.

Fix subsidy on N,P,K,S for 2010-11

Additional per ton subsidy for subsidized

fertilizer carrying other secondary nutrientsand micronutrients.eg in Zn,Boron.

Retail prices fixed by companies at farm gatelevel

10% increase in price of urea (Rs 4830 to Rs5310)


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Started from 1 April 2003

Objective- encouraging efficiency basedfertilizer pricing

High Powered Fertilizer Pricing Policy ReviewCommittee (HPC)

At present, the maximum retail price (MRP) ofurea is Rs. 483 a quintal, while DAP costs Rs.935 a quintal and MOP Rs. 445.50 a quintal.

First 2 stages-prices was decided on the basisof energy consumption

Third stage(2006-10)-conversion of all farmsinto natural feed stock.


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On 31stMarch11, Govt announced buy-bachkscheme of fertliser bonds through RBI in2 tranches of 50% each

Govt decided to compensate at least 50% of theloss on sale of bonds to RBI


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INDIAN AGRICULTURE

FOOD GRAIN PRODUCTION

SOIL FERTILITY IN INDIA

EMPHASIS ON IMPORT

IMPROVEMENT OVER CURRENTSCENARIO


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LONGTERM SUSTAINABILITY- NATURAL RESOURCES,

PRICE- ENERGY,SUBSIDISED PRICE

POLICY

GREEN REVOLUTION- GROWTH

SUSTAINABLE AGRICULTURE

R&D

CAPACITY

IMPORT

SOIL HEALTH

FERTILISER MARKETING

TECHNOLOGY


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Per capita fertliserconsumption is low

New joint ventures

Deregularisation Fast growing

population 2/3 population still

depends on farming as

a source of livelyhood

Uncertainty prevailingover policy

Late payment ofcommision

Shortage of feedstock Biofertilisers lack of monitoring lead

to anti competitive at the

level of distribution offertilizers to endconsumers.

THREATSOPPORTUNITY


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WEAKNESS STRENGTHS

High inventory carrying cost

Liquidity crunch Deterioration of quality due to

prolonged storage

Scarcity Lower import leading to

High International price

Additional burden on exchequer

Non-availability of fertilizer intime leads to lesser yield from farm

Market scarcity

Labour shortage

Stringent Govt. Policy

Supply Constraints

Production- Technical/Equipmentproblem

Feedstock/raw material shortage

Power shortage

High International Price

Low Exportable surplus

HYV Seeds

Availability

Credit availability Promotion & awareness

Demand factor

foreign investments in

India


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Political FactorsGovernment Support to Urea Manufacturing

Ineffective Implementation of GovernmentRegulationsGovernment Support for R&D in ChemicalIndustry

NBS Policy


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Economic FactorsHigh Taxes & Cost of Finance Eat into MarginsOngoing Reforms to Ensure a Favorable FDIPolicyNew investment Policy

Technological Factors:

Role of ICT Social Factors

Low-Cost Human Capital and TechnologicalExpertiseSurge Expected in Per Capita ChemicalsConsumption


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Fertilizer Corporation of India Limited (FCIL)

Hindustan Fertilizer Corporation Limited (HFC)

Pyrites, Phosphates & Chemicals Limited

Rashtriya Chemicals and Fertilizers Limited (RCF) National Fertilizers Limited (NFL)

Projects &Development India Limited (PDIL)

The Fertilizers and Chemicals Travancore Limited

(FACT) Madras Fertilizers Limited (MFL)

FCI Aravali Gypsum & Minerals India Limited,Jodhpur


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The Scientific Fertilizer Co Pvt Ltd

Coromandel Fertilizers Deepak Fertilizers and Petrochemicals Corporation

Limited Gujarat State Fertilizers &Chemicals Limited Tata Chemicals Limited

Chambal Fertilizers Nagarjuna Fertilizers and chemicals limited Godavari Fertilizers and Chemicals limited Zuari Industries limited Apratim International

Devidayal Agro Chemicals Aries AgroVet DSCL


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Consumer

base-high

Industry

Competitors

Rivalry among

existing firms-

low

Bargaining

power of

suppliers-low

Barriers to entry-high

Bargaining power

of buyers-low

FertilizerProducers


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Here, Suppliers are Raw materials Suppliers;Buyers are Distributors.

Bargaining power of suppliers-LOW Bargaining power of buyers-LOW

Barriers to entry HIGH

Consumer Base-HIGH

Rivalry among players LOW


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FertilizerDistributors Threat of

substitutes-

low

Industry

Competitors

Rivalry

among

existing

firms-low

Bargaining

power of

suppliers-high

Barriers to

Barriers to

entry-high

Bargaining power of

buyers-low


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Here Suppliers are the producer; Buyers are thefarmers.

Threats of substitutes

LOW Bargaining Power of Suppliers- HIGH

Rivalry among existing players- LOW

Bargaining power of the buyer(farmer) LOW

Barriers to entry- HIGH


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Fertiliser Industry & foodprocessing

Fertiliser industry & rural market

Fertiliser industry & seeds


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Greater dependency of country onimports( also feedstock)

Unable reduce burden of

government in subsidiary rates Infrastructural bottlenecks

Uncertainties in government policies

Small size of older plants

Low cost of production


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EXTENSION OF FERTLISER UNDER NBS DECANALISATION OF UREA

FERTILISER INDUSTRY SHOULD BE ANINDUSTRY OF NATIONAL IMPORTANCE

INVESTOR POLICY FOR LONG TERMINVESTMENT IN UREA

VAT HOLIDAY & SUBSIDISED ELECRICITY

SUPPLY TAX & DUTIES


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INDIAN JOURNAL OF FERTILISER, SEP11

ECONOMIC PLANNING

FAI ANNUAL SEMINAR 2010

ROLE OF ICT IN FERTILIZER & AGRICULTURE

SECTOR AND FUTURE PROSPECTS (S. C.MITTAL, IFFCO)

COMPETITION ASSESSMENT OF FERTILIZERSECTOR: INDIA 2011

DEMAND ANALYSIS & FORECASTING THEFERTILIZER INDUSTRY IN INDIA 2010-12

RURAL MARKETING

THE HINDU, 28THFEB11


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THANK YOU

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