After Restricting Magnets, China Now Imposes Agricultural Barriers for India
China is imposing restrictions on agricultural exports, especially specialty fertilizers, to India. Shipments meant for India face limited inspections, reflecting ongoing trade tensions. India’s reliance on specialty fertilizers is crucial, with market growth expected but local production remains unviable due to historical constraints. India may consider alternative suppliers amidst these challenges.
In a new development signaling continued tensions between China and India, reports indicate that China is implementing significant restrictions on agricultural exports aimed at India, particularly focusing on specialty fertilizers. This follows a pattern of previous actions involving key raw materials like rare earth magnets, which China restricted as a countermeasure to tariffs and other barriers imposed by India.
It appears that while shipments from various factories in China undergo government inspections, those intended for India are not being scrutinized in the same way. This circumvention has been described by sources familiar with the situation, suggesting that similar tactics have been employed to limit exports without a formal announcement of a ban. This trade friction is occurring against a backdrop of escalating tensions in recent years, which include border disputes and China’s support of India’s neighbor, Pakistan.
Specialty fertilizers, crucial for farmers, encompass a wide range of products such as water-soluble fertilizers and liquid fertilizers used for foliar applications. Other kinds include controlled and slow-release fertilizers, along with micronutrient and bio-stimulants, which significantly differ from more general commodity fertilizers like urea or DAP. Typically, India imports between 150,000 to 160,000 tonnes of these specialty fertilizers from China during the June to December period.
Looking ahead, the Fertilizer Association of India anticipates notable growth in the specialty fertilizer market, predicting it will surpass $1 billion by 2029 at a compound annual growth rate (CAGR) of 9.2%. Furthermore, sectors like biostimulants are expected to reach around $734 million by 2029 with a CAGR of 15.6%, while the organic fertilizer market may hit $1.13 billion by 2032 with a CAGR of 7%.
This growing demand for specialty fertilizers is motivated by their ability to enhance crop yields and improve soil health. However, India’s current production capabilities are insufficient, making local manufacturing economically unfeasible due to historically low consumption. But this could change, as the shift towards specialty over primary fertilizers is creating new opportunities for companies to establish manufacturing operations within India.
Despite these developments, experts suggest that India could consider sourcing these fertilizers from other countries. Jordan and European nations have been mentioned as possible alternative suppliers, although logistical challenges exist in ensuring timely shipments. These intricacies reveal the complexities in maintaining agricultural supply chains under current geopolitical conditions, as successive regulations and trade barriers continue to test the resilience of the fertilizer market.
In summary, China’s recent restrictions on agricultural exports, particularly specialty fertilizers, appear to be a continuation of retaliatory measures against India, amidst ongoing geopolitical tensions. With significant growth anticipated in India’s fertilizer market, local production remains complicated and challenging. As India explores alternative sources for these vital nutrients, the dynamics of international trade and production will play a crucial role in shaping future agricultural strategies.
Original Source: m.economictimes.com
Post Comment