Importers want hike in subsidy to keep prices of fertilisers stable

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FE Report
Fertiliser importers have taken a move to get increased subsidy from the government and ensure smooth supply system across the country to make the agricultural input available at a reasonable price to the farmers.
Bangladesh Fertiliser Association (BFA), a platform of the local fertiliser importers, will meet agriculture adviser CS Karim on July 18 and request him to raise the rate of subsidy.
Currently, the government provides 25 per cent subsidy to the private fertiliser importers for distribution to farmers at a lower rate equal to the proportion.
The private sector importers and state-owned Bangladesh Agricultural Development Corporation (BADC) bring triple-super phosphate (TSP), muriate of potash (MoP), di-ammonia phosphate (DAP) and some other varieties of fertiliser from abroad while the state-owned Bangladesh Chemical Industries Corporation (BCIC) imports urea.
Some importers said that fertiliser would be dearer in the domestic market because of a hike in its prices in the international market.
"If the government does not increase the rate of subsidy on the agricultural input, the price in the local market will go up by Tk 200 to Tk 300 per bag (50-kilogram)," Kafil Uddin Ahmed, president of the BFA told the FE.
In fiscal 2006-07, the importers supplied TSP at Tk 634 to Tk 705 per bag, MoP at Tk 630 to Tk 660 per bag, and DAP at Tk 930 to Tk 986 per bag to the farmers after deducting 25 per cent subsidy on total import cost, the importers said.
According to the importers, the price per tonne of urea in the international market is now US$370 to $390 against $230 to $260, available four to five months ago, triple-super phosphate (TSP) at $350-$370 against $230-$250, muriate of potash (MoP) at $260-$280 against $230-$240 and di-ammonia phosphate (DAP) at $370-$390 against $260-$280.
Kafil Uddin Ahmed said: "We had fixed the fertiliser price for the farmers after deducting 25 per cent cash subsidy from the total import cost. As the fertiliser prices in the global market were lower than current rate, we had been able to supply those at the reasonable price. But in the current fiscal we will not be able to supply fertiliser at the same rate."
The government last month asked the public and private sector importers to import adequate fertiliser to meet the demand in the new fiscal.
The Agriculture Ministry sources said the demand for urea in new fiscal has been fixed at 2.814 million tonnes, TSP at 0.475 million tonnes, DAP at 0.25 million tonnes, MoP at 0.4 million tonnes and NPKS at 0.15 million tonnes.
Out of the quantity, the BCIC will import 1.10 million tonnes of urea and the rest 1.714 million tonnes urea will be supplied by the local state-owned fertiliser factories.
The BADC will import 50,000 tonnes of TSP and a similar quantity of MoP while the private sector will import 0.177 million tonnes of TSP and 0.264 million tonnes of MoP.
Besides, the government will not import any DAP as the local state-owned fertiliser factories will produce 0.25 million tonnes of the item.