Sulphur Import Prices Treble in a Year, Threatening India's DAP and SSP Fertiliser Supply

The news

NEW DELHI. India has staved off a potential food crisis by importing enough urea and liquefied natural gas to allow domestic production of high-nitrogen fertiliser, but soaring prices of another critical commodity, sulphur, are now affecting the availability of di-ammonium phosphate (DAP), single super phosphate (SSP) and other major complex fertilisers, The Indian Express reported on 21 September. Since the start of this year, landed prices of sulphur imported into India, meaning cost plus ocean freight, have doubled to $1,050-1,100 per tonne; the headline puts the rise at three times in one year. The main reason is Ukrainian long-range drone and missile attacks on Russian oil refineries and gas complexes, and Iran similarly targeting the energy infrastructure of Saudi Aramco, QatarEnergy and Abu Dhabi National Oil Company. This is because only a tenth of the world's sulphur is mined; the rest is a by-product of petroleum refining (56%) and natural gas processing (34%), recovered because environmental rules require removal of sulphur from crude oil and raw gas to make clean fuels. The fertiliser sector accounts for roughly 60% of the 70 million tonnes of sulphur consumed globally each year. Most of it is turned into sulphuric acid, which is needed to break down rock phosphate into a water-soluble form that plants can absorb. “Without sulphur and sulphuric acid, there can be no DAP, SSP or popular complex fertilisers such as 20:20:0:13, 10:26:26 and 12:32:16,” an industry official said. India consumes 3.8-3.9 million tonnes of sulphur a year, of which the fertiliser industry takes 2-2.1 million tonnes. Prices, below $100 a tonne in many months of 2019 and 2020, rose to $400-500 during March-June 2022 after the Russia-Ukraine war, fell back below $200 from late 2022 to early 2025, and began climbing again when Ukraine stepped up strikes on Russian refineries from around August 2025, crossing $500 by December and rising further after the US-Iran war. Import prices of sulphur and sulphuric acid now stand at about $1,070 and $330-350 a tonne, after touching $1,150 and $420 two months ago. Russia has banned exports of sulphur and sulphuric acid, and China of sulphuric acid. Demand is also rising: sulphuric acid used for extracting nickel for electric-vehicle batteries, much of it in Indonesia, rose from 3.5 million tonnes in 2021 to 16 million tonnes in 2025. Iffco, Coromandel International and Paradeep Phosphates have secured rock phosphate through tie-ups in Jordan, Senegal and Morocco. India's phosphoric acid capacity of about 2.2 million tonnes meets half of its requirement of 4.3-4.5 million tonnes, which supports 15-16 million tonnes of phosphatic fertiliser output. Syllabus link: agricultural inputs, subsidies and food security, GS3.

Static syllabus linkage

1. Phosphatic fertilisers are decontrolled and subsidised under Nutrient Based Subsidy. Since 1 April 2010, phosphatic and potassic fertilisers have been covered by the Nutrient Based Subsidy scheme, under which the Union government fixes a per-kilogram subsidy for nitrogen, phosphorus, potash and sulphur, and companies are in principle free to set the retail price. Urea stays outside NBS, with a statutorily controlled retail price and the subsidy absorbing the difference. When input costs rise sharply, NBS rates must be raised or retail prices go up, which is why a sulphur shock quickly becomes a fiscal or political question.
2. Sulphur is both a manufacturing input and a plant nutrient. Sulphur is the fourth major nutrient after nitrogen, phosphorus and potassium, needed for protein synthesis and especially important for oilseeds and pulses; that is why the fourth figure in a grade such as 20:20:0:13 denotes sulphur. SSP contains phosphorus and sulphur together, and DAP carries 18% nitrogen and 46% phosphorus pentoxide. The same element is therefore both the acid that makes the fertiliser and a nutrient inside it.
3. The regulatory frame is the Essential Commodities Act. Fertiliser is declared an essential commodity, and the Fertiliser (Control) Order, 1985, issued under Section 3 of the Essential Commodities Act, 1955, regulates quality, pricing, distribution and dealer registration. The Department of Fertilizers under the Ministry of Chemicals and Fertilizers administers the subsidy, and the Department of Agriculture assesses State-wise seasonal requirements.
4. India's phosphate chain is import-dependent at every stage. India has limited deposits of rock phosphate, and it imports rock phosphate, phosphoric acid, finished DAP and now sulphur. The report's figure that domestic phosphoric acid capacity of about 2.2 million tonnes meets only half of requirement shows that even domestic manufacturing rests on imported intermediates. Overseas joint ventures for rock phosphate in Jordan, Senegal and Morocco secure one input but not the sulphur needed to process it.

Why UPSC loves this

1. Fertiliser subsidy and imbalance are recurring GS3 themes. UPSC has asked about the Nutrient Based Subsidy scheme, the distortion caused by cheap urea and the resulting imbalance in the N:P:K ratio, and about the fertiliser subsidy's fiscal burden. A supply shock in phosphatic fertiliser adds a new dimension: import dependence and geopolitics, which connects the agriculture syllabus to international relations.
2. The geopolitics of critical inputs is a new favourite. Recent papers have moved towards supply-chain resilience — rare earths, semiconductors, energy. Sulphur is a good example of a humble commodity whose supply depends on distant conflicts, and it lets a candidate show that food security has an external dimension.

Analysis

1. The clean-fuel transition quietly made fertiliser hostage to oil. Because desulphurisation rules turned refineries into the world's sulphur mines, the phosphate supply of an agricultural economy now depends on the health of oil and gas infrastructure. That coupling was invisible when sulphur was a cheap waste product selling below $100 a tonne. It becomes visible only when refineries are bombed. Any serious answer on food security should recognise that energy security and fertiliser security are now one problem, not two.
2. The NBS design passes the shock either to the farmer or to the budget, and both are costly. Under NBS, a company that pays three times more for sulphur must either raise the retail price or wait for the government to raise the per-kilogram subsidy. If retail prices rise, farmers cut phosphate and potash use while continuing with cheap urea, worsening an already distorted nutrient ratio. If the subsidy rises, the fiscal cost climbs in a year already burdened by high energy prices. The counter-argument is that some price signal is healthy, since it encourages efficient use; but in a sowing season the signal arrives too late to change practice and simply reduces yields.
3. Securing rock phosphate abroad solved the wrong half of the problem. Indian companies have built joint ventures in Jordan, Senegal and Morocco for rock phosphate, which was the obvious vulnerability. The industry's own warning is that rock phosphate cannot become fertiliser without sulphur. Resilience planning that secures the raw ore but not the processing chemical is incomplete, and the lesson extends to other supply chains: dependence hides in the intermediate step.
4. The EV boom competes with food for the same acid. Sulphuric acid demand for nickel processing jumped from 3.5 million tonnes in 2021 to 16 million tonnes in 2025. This is not a temporary war effect; it is a structural shift driven by battery demand. Even if the conflicts end, fertiliser makers will compete with battery-material producers for acid. Policy should therefore plan for durably higher prices rather than wait for a return to the sub-$200 years.
5. The domestic options are limited but real. India's own refineries and the smelters of Hindustan Zinc and Birla Copper already supply some sulphur and acid. Ensuring that domestic by-product sulphur and acid are channelled to fertiliser plants, building strategic reserves where storage risks can be managed, and promoting nano and organic phosphate alternatives where evidence supports them are sensible steps. None of them removes the import dependence quickly, which is why the immediate lever remains the subsidy rate.

Administrator's brainstorm