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1.4 billion people will never give in to their jobs: China tightens fertilizer exports
Sina Finance

Sina Finance

2026-03-19 10:54

·Hebei *Creator in the field of high-quality finance and economics
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Source: Market information
(Source: Steel VS Observation)
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Now is the critical time for spring plowing and preparing for plowing. The crops in the fields are waiting for fertilizer, and the rice bowls of 1.4 billion people are tied to this stubble of sowing.

Recently, China has introduced a strict control policy for fertilizer exports, tightened the outflow of fertilizer through export quotas and license management, prioritized the domestic fertilizer demand for 1.8 billion mu of cultivated land, and steadily guarded the bottom line of food security for 1.4 billion people.

The latest data released by the General Administration of Customs of China in March 2026 show that: from January to February 2026, China exported a total of 327,000 tons of urea, down 68.2% year-on-year; exported 214,000 tons of diammonium phosphate, the core phosphate fertilizer variety, down 72.5% year-on-year, and the export volume of the main fertilizer variety fell by more than 70% year-on-year. The intensity of policy tightening is far beyond market expectations.

As soon as this news came out, the most restless country in the global food market was not the small Middle Eastern country that relied on food imports, but India, which has the world's largest arable land area and is known as the “world's largest rice export country.”Recently, India has repeatedly issued emergency procurement inquiries to China through official channels, hoping that China will relax export restrictions and supply it with at least 3 million tons of urea to solve the urgent need for spring plowing.

Many people will be curious: India has more arable land than us, and the agricultural population exceeds 400 million. How can it be stumped by fertilizer?The answer is actually hidden in its seemingly powerful agricultural system-the fragile lifeblood that is completely based on “imported fertilizers to grow food.”

1. You may not think that the food lifeblood of India, a large agricultural country, is supported by imported fertilizers.
   Many people have a misunderstanding: India's cultivated land area is 180 million hectares, which is half more than our 120 million hectares. Grain exports rank in the top three in the world all year round. How can there be a shortage of fertilizer?
   But the truth is that India is not only one of the world's largest grain exporters, but also the world's largest importer of fertilizer.None of the three major fertilizers necessary for the growth of staple foods, rice and wheat, can be independently controlled in India.

2. The three main fertilizers are fully dependent on imports, and China is the core supplier

Public data from the Rural Economic Research Center of the Ministry of Agriculture and Rural Affairs show that the three main fertilizers, urea, phosphate fertilizer and potash fertilizer, have a comprehensive contribution rate of more than 60% to the production of staple foods such as rice and wheat.Simply put, whether the crops grow well or not, and whether the yield is high or not, all depend on these three fertilizers to support the bottom.

And these three key fertilizers, India's external dependence, have all reached the cordon.：

-Urea (staple food and core fertilizer): India's annual urea consumption is about 36 million tons, and its domestic production capacity is only 27 million tons. There is an annual production gap of nearly 9 million tons. 25% of urea is completely dependent on imports. It has been ranked as the world's largest importer of urea for 5 consecutive years.According to the latest statistics from the Ministry of Fertilizer of India and the General Administration of Customs of China, from April 2025 to February 2026 (India's fiscal year 2025-2026), India imported a total of 7.45 million tons of urea, of which 2.124 million tons were imported from China, accounting for 28.5% of its total imports. China is India's second largest source of urea imports, second only to oil-producing countries in the Middle East.

-Phosphate fertilizer (core fertilizer for anti-reverse production increase): Import dependence exceeds 45%. In the first 11 months of the 2025-2026 fiscal year, India imported 5.8 million tons of diammonium phosphate, of which 3.52 million tons were imported from China, accounting for 60.7%. China is the absolute core supplier of phosphate fertilizer in India.
-Potash fertilizer (strong seed anti-inversion core fertilizer): India has almost no recoverable potash resources, and its import dependence is as high as 92%. It relies entirely on imports to fill the gap. Any fluctuation in the global potash fertilizer trade will directly affect India's agricultural production.

1. Without imported fertilizers, India's basic food supply cannot be supported.

Global agricultural data released by the Food and Agriculture Organization of the United Nations in 2025 show that the average yield of rice in India is only 239 kg/mu, less than half of China's 472 kg/mu; the yield of wheat is 223 kg/mu, which is only 57% of China's 390 kg/mu.

One of the core reasons for the yield gap is insufficient fertilizer application and unstable supply.The Indian agricultural sector has calculated that for every 1 kg reduction in urea application, rice production per acre will drop by 4-5 kg; once fertilizer imports are cut off, no matter how much arable land and how many farmers there are, India's food production will directly decline sharply.

1. Hundreds of billions of subsidies can't hit the main production capacity, and the finances are already overwhelmed.
   Some people may ask, since fertilizer is so important, why doesn't India build its own factory?In fact, it's not that I don't want to, it's really difficult.

In order to maintain agricultural stability, India spends a lot of financial funds on fertilizer subsidies every year, but it has never been able to build an independent and controllable local production capacity.The latest announcement of the Ministry of Finance of India in March 2026 shows that India's fertilizer subsidy budget for the 2025-2026 fiscal year is as high as 10.2 trillion rupees (about 120 billion US dollars), accounting for 12% of the country's fiscal expenditure; as of February 2026, a total of 11.7 trillion rupees of subsidy funds have been allocated, which is 14.7% overspend on the annual budget.If natural gas prices continue to rise, the annual subsidy overspend will exceed 30%, and the finances have been dragged to the verge of being overwhelmed by fertilizer subsidies.

Second, the four-fold pressure is superimposed, India's spring plowing really can't afford to wait

This time China tightened fertilizer exports, the reason why India is so anxious is because it just hit India's four key pressure thresholds-it can't afford to make a mistake, and it can't wait for a day.

I hope Modi acts wisely.

I truly wonder how BJP fanatics can maintain their image of this guy as a god figure while he twists and turns pragmatically to make up for world-historic mistakes it's a shame. Their videos about steel production show off pots and pans and machetes I thought it was a joke first time I saw it

I mean they are useful items, but are they not even thinking about security? 😳

Most succinct way I can put it is that the more heightened the contradictions are / clearly the battle lines are drawn, the more homicidally insane actors capital needs to carry out these duties, against not only the interest of their neighbor, but against their own interest in like one or two generations. That can always be cut short by Gaddafi-ing people but the allure of Miami is strong 🤢 for some reason. What happens when they're expected to do things against their own interest on a timespan of mere years or even months though? I guess all we can do is hope that watching a nation burn itself out against industrial warfare (BJP are more closely allied w Israel than Ukraine) lends political legitimacy to parties that are neutral on China. After all they have the seeds of a popular revolution brewing over the agricultural crises. Sorey that was a mouthful, not fond of Modi. I like when NITROGEN is REPLENISHED and NOT DEPLETED bruh

No sorry needed, I love it when you educate us!

i'm trying to teach everyone how to steal smart people's shit like this too maeve!!! stop pretending i'm not dumb 💀 I owe you guys like 17 longform pieces. I made a list

Mmm, most of us don't really know where/how to look for it. Including myself.