India seeks discount in rare one-year urea import tender -document

Rashtriya Chemicals and Fertilizers

06/01/2023 11:09

By Nidhi Verma
       NEW DELHI, Jan 5 (Reuters) - India has issued a global
urea tender asking producers to quote a discount for the supply
of 600,000 tonnes of urea, industry sources said and a document
shows, as the nation seeks to cut import costs and secure
cheaper supplies of the soil nutrient.
    India, where soil nutrients are sold at below market rates,
annually imports urea through tenders by authorised companies
such as India Potash Ltd, Rashtriya Chemicals and Fertilizers
Corp  RSTC.NS  and National Fertilizers Ltd  NAFT.NS .
    "This is the first tender where we are seeking quotes on
discounts on the lowest price to be discovered through routine
tenders ... we are essentially locking in the discount number,"
one of the sources said.
    The tender seeking discounts on supplies in a year from
March 1 will close on Jan. 23, with offers remaining valid until
Feb. 5, the document shows.
    Sellers will have to offer a discount in percentage terms
that will be applied to the urea's delivered price. Delivered
prices are set through four to five routine tenders per year for
supplies to India's eastern and western coasts.
    Urea producers directly, or through their "authorised
exclusive marketer", can participate in the tender, the tender
document shows.
    India aims to import about 4 million tonnes through routine
tenders in a year from March, the source said, citing
preliminary estimates.
    The winner of this new tender will be assured of supply of
an average of 50,000 tonnes of cargo every month to India, a
second source said.
    Higher global prices mean that India's fertiliser subsidy
bill for the financial year to March 31 will rise to a record
2.25 trillion Indian rupees ($27.2 billion) from about 1.5
trillion rupees the previous year. 
    Urea accounts for about 70% of India's overall fertiliser
subsidy.
($1 = 82.7310 Indian rupees)
 (Reporting by Nidhi Verma
Editing by David Goodman)
 ((nidhi.verma@thomsonreuters.com; +91 11 49548031; Reuters
Messaging: nidhi.verma.thomsonreuters.com@reuters.net))