DAP fertilizer prices surge to $720/ton globally, increasing subsidy pressure on the Indian government. The price of Di-Ammonium Phosphate (DAP), India’s second most-consumed fertilizer after urea, has skyrocketed to $720 per ton in the international market. This surge is expected to increase the government’s subsidy burden, though retail prices for farmers are unlikely to rise immediately. Despite the government increasing subsidies to ₹27,799 per ton for the Kharif 2025 season (April-September 2025), fertilizer companies continue to face losses on DAP imports.
Why Are DAP Prices Rising?
- February 2025: $640/tonne
- Current Price (June 2025): $720/tonne
- Phosphoric Acid (Raw Material): $1,153/tonne
India consumes around 10 million ton of DAP annually, with 4.8 million ton produced domestically and the rest imported. However, even domestic production relies on imported raw materials like rock phosphate and phosphoric acid, making India heavily dependent on global markets.
Subsidy vs. Import Cost
| Factor | Cost (₹/ton) |
| Current Import Price | ₹61,200 ($720) |
| Additional Costs (Customs, Handling, etc.) | ₹3,800 |
| Total Cost | ₹65,000 |
| Government Subsidy | ₹27,799 |
| MRP (Maximum Retail Price) | ₹27,000 |
| Company’s Revenue (Subsidy + MRP) | ₹54,799 |
| Net Loss per Tonne | ₹10,201 |
Government’s Response & Long-Term Contracts
To stabilize supply, the government has signed long-term import agreements with:
- Morocco (OCP Group): 2 million tonnes/year
- Saudi Arabia (Ma’aden): 2 million tonnes/year
However, imports from China and Russia remain uncertain, keeping prices high.
Will DAP Prices Increase for Farmers?
The government has assured that farmers will not face price hikes, with additional costs being absorbed via subsidies. However, delayed subsidy payments to companies remain a concern.
DAP Fertilizer: 10-Year Price & Subsidy Trends
| Year | Global DAP Price ($/tonne) | Govt. Subsidy (₹/tonne) | Retail Price (₹/tonne) |
| 2015 | $450 | ₹12,350 | ₹24,000 |
| 2016 | $380 | ₹14,200 | ₹22,500 |
| 2017 | $340 | ₹15,000 | ₹22,000 |
| 2018 | $390 | ₹16,500 | ₹23,000 |
| 2019 | $400 | ₹18,000 | ₹24,250 |
| 2020 | $320 | ₹20,150 | ₹24,000 |
| 2021 | $580 | ₹23,000 | ₹25,000 |
| 2022 | $660 | ₹24,000 | ₹27,000 |
| 2023 | $620 | ₹25,500 | ₹27,000 |
| 2024 | $640 | ₹21,911 | ₹27,000 |
| 2025 | $720 | ₹27,799 | ₹27,000 |
FAQs on DAP Fertilizer
1. Why is DAP so expensive in 2025?
Global supply chain disruptions, high demand, and rising phosphoric acid costs have pushed DAP prices to $720/tonne.
2. Will Indian farmers pay more for DAP?
No, the government has fixed the MRP at ₹27,000/tonne (₹1,350/bag) and increased subsidies to compensate.
3. How much DAP does India import?
India imports 5.2 million tonnes/year, mainly from Morocco, Saudi Arabia, and Russia.
4. What is the raw material for DAP?
Rock phosphate and phosphoric acid, both largely imported.
5. Why doesn’t India produce enough DAP?
Limited domestic phosphate reserves force reliance on imports.
6. How does the subsidy work?
The government pays ₹27,799/tonne to companies to keep prices stable for farmers.
7. Are Chinese DAP imports resuming?
Not yet—China’s export restrictions are contributing to high global prices.
8. What’s the future of DAP prices?
If China resumes exports, prices may drop; otherwise, they could rise further.
9. Which Indian companies produce DAP?
Major producers: IFFCO, Coromandel, and FACT.
10. What alternatives exist for DAP?
Farmers can use NPK fertilizers, organic manure, or SSP (Single Super Phosphate) and Learn more khabar Darbar. …