Considering the global price hike of Urea fertiliser the government has raised the price to Tk22 per kilogram from Tk16 for farmers.
The Ministry of Agriculture set the price in a notice published today and the new price will be effective from Monday (1 August).
The announcement came in just five days after Agriculture Minister Dr Abdur Razzaque said that Prime Minister Sheikh Hasina does not want to increase fertiliser price in the country for the sake of the country farmers despite global price hike.
At the dealer level the price has been fixed at Tk20 per kg, which was Tk14 before.
The current price of urea fertilizer per kg in the international market is Tk81. Despite raising the retail price by Tk6 the government still has to pay a subsidy of Tk59.
In the fiscal year 2005-06, the government had to pay a subsidy of only Tk15 per kg.
Demand for Urea this year has been estimated as 26 lakh tonnes. Of the total demand 10.5 lakh tonnes will be produced in the country's fertiliser factories, the rest will be imported.
Agriculture Minister Muhammad Abdur Razzaque on 20 July said that his ministry is trying to find alternative sources from where the much-needed Urea fertilizer can be purchased.
The current agriculture-friendly government under the leadership of Prime Minister Sheikh Hasina has reduced the price of fertilisers four times since 2009 and is delivering sufficient fertilisers at the doorsteps of farmers at very low prices.
Meanwhile, di-ammonium Phosphate (DAP) fertiliser contains 18% nitrogen or the main ingredient of Urea fertiliser.
That is why the government reduced the price of DAP fertiliser from Tk90 to Tk16 per kg to reduce the unnecessary and excessive use of urea fertiliser by increasing the use of DAP.
As a result of this initiative, the use of DAP fertilizer has doubled in the last few years. In 2019, 8 lakh tonnes of DAP was used, currently 16 lakh tonnes are being used.
However, the use of Urea fertilizers has not decreased, rather increased further. In 2019, about 25 lakh tonnes of Urea was used, and it is estimated that 26 lakh 50 thousand tonnes of Urea will be used this year.
On the other hand, the price of fertilisers has increased by about 3-4 times in the international market over the last one year.
As a result, the subsidy given by the government in the country has also increased almost four times. In the fiscal year 2020-21 the subsidy cost for Urea was Tk7,717 crore, whereas Tk28,000 crore was spent as subsidy in the financial year 2021-22.
Fertiliser stock in the country
In the press release published by the agriculture ministry on 1 August, it was said that there is sufficient stock of all kinds of fertilizers in the country against the demand.
The demand of Urea fertiliser in the country during Amon season (July-September) is 6.19 lakh tonnes.
Right now the country has a stock of 7.27 lakh tonnes, which is about 1 lakh tons more than the requirement.
For the Amon season, there is stock of 3 lakh 9 thousand tonnes TSP against a demand 1 lakh 19 thousand tonnes.
There is a stock of 6 lakh 34 thousand tonnes DAP against a demand of 2 lakh 25 thousand tonnes.
The country has a stock of 2 lakh 10 thousand tonnes MOP against a demand of 1 lakh 37 thousand tonnes.