Government Floats 2.5 MT Urea Tender As Supply Tightens

India is trying to secure fertiliser supplies by floating a global tender to import 2.5 million metric tonnes of urea, as disruptions in West Asia tighten availability ahead of the crucial Kharif sowing season.

The geopolitical tension not only impacted essential agricultural inputs but also affected India’s leading fertiliser companies. For example, Coromandel International’s share price has dropped almost 6% in the last month and was ₹1,884 at the close of the market on 6 April, 2026. Another leading company in the sector, Chambal Fertilisers & Chemicals, also saw a 1.19% decline on the day and closed at ₹447.

Key Details Of The Tender

State-run Indian Potash Ltd (IPL) has issued the tender to procure urea, with a clear distribution plan of 1.5 million tonnes via the west coast, and 1 million tonnes via the east coast.

Shipments are required to leave supplier ports by 14 June, while bids for the tender must be submitted by 15 April.

Why Is India Rushing To Secure Urea?

The urgency behind the tender comes from supply disruptions linked to tensions in West Asia. Around 20%–30% of India's urea imports, and nearly 50% of its LNG imports used for domestic urea production, come from the Gulf.

Disruptions around the Strait of Hormuz have affected shipping routes, reduced LNG supply, and tightened global fertiliser chains. This has created a double problem. Imports are under pressure, and domestic production is also getting hit.

Industry estimates suggest output has dropped by 6–7 lakh tonnes per month. The Fertiliser Ministry reported that production has fallen from around 24 lakh tonnes to 18 lakh tonnes during this period.

Because of this, the government is now relying more on imports to keep supply steady.

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What To Watch Next?

In the last tender held in November, India bought urea at US$418.40 per tonne (CFR). Prices have gone up since then, so the current purchase could be more expensive. Since India is one of the world’s largest urea importers, this tender could also influence global price trends.

The result of the tender will be closely watched. The main aspects to follow are the number of global suppliers participating, the final prices India actually pays, and the speed of shipment arrival. In case prices are above expectations or shipments are delayed, it may increase subsidy costs and have an impact on the whole agriculture sector.

Sources:

Business Standard

The Economic Times