Supply shortage causes surge in fertiliser price

Farmers in some places have complained about shortages in supply of fertilisers, a situation which is compelling them to purchase fertilisers at higher than official fixed prices.
Market stakeholders have blamed inadequate local manufacturing and imports of fertilisers, and failure to distribute fertilisers in proportion to the demand in each region. Regulators have still ruled out any possibility of shortage of fertilisers, insisting that the shortfall is artificial.

According to many farmers and fertiliser traders in the Sherpur-Jamalpur region, increasing crop intensity and cultivation of new crops such as banana and vegetables round the year have increased the demand for chemical fertilisers.
"There is no fallow land these days as farmers sow seeds or plant seedlings on their land round the year. That's why we see additional demand of fertilisers. However, it is not supplied accordingly. Urea, TSP (triple super phosphate), and MOP (muriate of potash) are more or less available but there is a crisis of DAP (diammonium phosphate)," Zakir Hossain (40), a trader styled dealer of fertilisers and pesticides, observed on 26 September. He has a licence from Bangladesh Chemical Industries Corporation (BCIC) and Bangladesh Agriculture Development Corporation (BADC).

He cited an example that in his area of Gosaipur Union, only 12.20 tonnes of DAP fertiliser was allotted recently, against an estimated demand of 30 tonnes for 19,000 farmers living there. "I can deliver one bag (50 kilograms) when a farmer demands five times," he added.
BCIC issues licences for distribution of both locally produced and imported fertilisers and BADC does the same job to provide input support to farmers, often at subsidised rates.

A listed dealer, Samiul Haque (42) of Sribordi Poshchim Bazar, said there are signs of shortage of fertilisers, especially of DAP. "We receive allotment of 20 tonnes when the requirement is 100 tonnes. When dealers sell each bag of fertiliser at Tk 1,050, the farmers have to buy it at higher price from the retailers," he pointed out.

Jobon Krishna Roy, a dealer who has been running the business at Hajipur Bazar in neighbouring Jamalpur district town for three decades, mentioned that the amount of fertilisers they receive is far from meeting the demand of the area. So he has to collect fertilisers from districts where demand is lower at this point in time. "We've collected each bag of urea at a cost of Tk 1,450 and DAP at Tk 1,560 per bag from Chattogram. I will make profit of Tk 20–25 per bag, and the retailers will sell them at the prices they will find profitable," he told this author.

A farmer of Bharera Bazar in Sherpur, Sabuj Miah (28), complained that he managed to purchase one-fifth of the fertilisers he needed at officially fixed rates. "We have to spend Tk 1,650 for buying a bag of fertiliser which is sold by dealers for Tk 1,050. We're concerned about the situation during the peak cultivation season in November and December," he said.

Mojibur Rahman (60), a farmer of Diar Char in Sribordi, recalled that the local godowns and shops were full of fertilisers earlier but are now almost empty. "I have been able to buy one bag at the official rate when I need five bags of fertilisers. I have to spend an additional amount of Tk 200 to 250 for each bag of urea and Tk 400 to 500 for each bag of DAP. We have to cultivate no matter what the price of fertiliser is," said the farmer who owns four acres of land.

Shamsul Haque (70), a farmer of Paboi village in Jamalpur Sadar, said, "Dealers cannot give us fertilisers as per demand. We cannot get Jamuna company's fertiliser, and sometimes we don't get the fertiliser we need."

President of trade body Bangladesh Fertiliser Association Waliur Rahman said that the government is yet to disburse outstanding amounts to private fertiliser importers. "That's why they cannot import fertilisers and the two government agencies, BCIC and BADC, cannot allot adequate volumes of fertilisers to the dealers. Also, some dealers who were appointed during the previous regime have fled, and their associates are not regularly selling fertilisers," the business leader explained.

When contacted, Agriculture Secretary Dr Mohammad Emdad Ullah Miah denied complaints of any shortage of fertilisers. "There is an attempt to create fear of fertiliser shortage. A section of dealers are also taking advantage of the situation, and selling fertilisers at higher prices. However, in case of malpractice, the licence of the culprits will be cancelled," he added.

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