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Spot prices for liquefied natural gas (LNG), which has been supplied to the fertilizer industry, have been pegged at around $19 per metric million British Thermal Unit (MMBTU), a senior government official told reporters on Monday (March 31, 2026).
“Before the war, spot prices were around $11/MMBtu,” they said, adding: “Since the war, we have been buying LNG for our fertilizer units at around $19.”
Global fertilizer markets have seen a “surge” in prices of inputs such as LNG, ammonia and sulphur, accompanied by a surge in transport and logistics costs, amid the ongoing conflict in West Asia, the government observed.
At present, India would use around 30% of the requirements of the fertilizer industry for the spot market.
The prevailing situation and supply control measures have also had an impact on the domestic production of urea.
For context, India gets about 20-30% of its urea and 30% of its ammonium phosphate (DAP), along with nearly half of its natural gas consumption, from the Gulf region. It is important to note that amid the escalating conflict, Tehran also attacked the facilities of QatarEnergy, which is the world’s largest importer of natural gas and is among India’s major suppliers.
Starting domestic production
According to government estimates, the total requirement for the upcoming Kharif sowing season is about 390 thousand tonnes. Total reserves are around 180 million tons. Now, with natural gas supplies to urea plants increased to 75-80% of requirements through alternative measures, urea production has increased by 12,000-15,000 tonnes per day.
“(Thereby) reducing the monthly production loss from 9-10 LMT to around 6-7 LMT,” the government informed.
It is important to note that India produced 18 million tonnes of urea, 9 to 10 million tonnes of phosphorus and potassium fertilizers in March this year, according to government estimates.
In addition, India is entering Russia, Morocco, Australia, Indonesia, Malaysia, Jordan, Canada, Algeria, Egypt, Finland and Togo in an effort to stabilize the supply of key raw materials such as sulfur and LNG.
Published – 31 Mar 2026 03:01 IST
