May 26: The prices of chemical fertilisers such as urea, diammonium phosphate (DAP) and potassium have increased in the international market due to the effect of coronavirus pandemic. As a result, stakeholders say that the budget allocated by the government for the purchase of those chemical fertilisers will be insufficient.

As the prices of fertiliser have increased in countries including Bangladesh, Saudi Arabia, and India from where fertilisers are imported in Nepal, its impact will be seen in Nepal as well. The price of urea, which was $317 per metric ton, has increased to $455 per metric ton. According to the Salt Trading Corporation, the price of DAP has also increased from $420 to $650 per metric ton.

Spokesperson of the corporation, Kumar Rajbhandari, said that the production cost has increased as the price of raw materials used by the fertiliser industries has increased due to the pandemic. Likewise, the lack of manpower has decreased the production of the factories, and lack of manpower of the transportation companies might have resulted towards increased price of fertilisers.

The budget allocated by the government for purchasing the fertilisers is insufficient as the prices of the fertilisers have been increasing since the last five months. The government has allocated Rs 11 billion to buy subsidised fertilisers for the current fiscal year. Likewise, the government aims to allocate the budget of equal amount.

“While around 700,000 metric tons of chemical fertiliser is required in the country, only 500,000 metric tons of fertiliser can be bought with the current budget. If the budget is not increased,  the current budget will be enough to buy only 275,000 metric tons of fertiliser,” spokesperson of Agriculture Inputs Company Limited Bishnu Pokharel told New Business Age.

According to him, if the government does not increase the budget, the procurement volume will decrease and the farmers will face shortage of fertilisers again. Therefore, he suggested that the budget should be increased. Pokharel said that even though the prices of fertilisers in the international market have increased, it will not affect the farmers they get the fertilizers at subsidized rate.