India Turns to Saudi Arabia for Fertiliser as China Pulls Back Supply

India has signed long-term agreements with Saudi Arabia for the supply of diammonium phosphate (DAP) fertiliser, as per news reports. State-owned mining company Maaden will supply 3.1 million metric tonnes of DAP per year to Indian Potash Ltd (IPL), KRIBHCO, and Coal India Ltd (CIL) starting FY26. The deal will run for 5 years, with a provision to extend for another 5.

Ministerial Visit to Saudi Arabia

The agreements were signed during Union Minister JP Nadda’s visit to Saudi Arabia from July 11 to 13, 2025. The Indian delegation also visited Ma’aden’s phosphate production facility at Ras Al Khair. India is a key buyer of Saudi fertilisers, and Ma’aden is the Kingdom’s main player in this space.

Discussions also covered expanding cooperation beyond DAP to include urea and other key fertilisers. A joint team, led by the Fertiliser Secretary from India and the Vice Minister for Mining Affairs from Saudi Arabia, has been formed to explore long-term partnerships and investment options between both sides.

India's Fertiliser Dependency

India requires about 10-11 million tonnes of DAP every year, with around 60% sourced through imports. In FY25, India imported 1.9 million tonnes of DAP from Saudi Arabia, up from 1.6 million tonnes in FY24, a 17% increase.

India has faced supply issues from China in recent months. Though no official ban is in place, Chinese authorities have stopped inspecting fertiliser consignments bound for India. This has stalled about 150,000-160,000 tonnes of speciality fertilisers at ports.

Imports from alternate sources like Europe and West Asia are already 15-20% costlier. Around 80,000-100,000 tonnes are now being sourced from other countries to fill the shortfall. Higher freight and limited availability are pushing prices further.

Read More: Best Fertilizer Stocks in India For July 2025 - Deepak Fertilizers, Mangalore Chemicals & More!

Conclusion

With delays in Chinese shipments and rising costs elsewhere, India’s agreements with Saudi Arabia are aimed at stabilising fertiliser supply in the coming years through fixed long-term arrangements.

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