Ever since the decontrol of phosphoric and potassic fertilizers came into force in 1992 – while retaining urea under price control regime with a heavy subsidy component, there has been a steep increase in the farmgate prices of these complex plant nutrients resulting in a slowdown in their consumption.
Following decontrol, consumption of phosphates declined from 3.32 million tones in 1991–92 to 2.87 million tones the next year and further to 2.67 million tones in 1993–94. It recovered by nine per cent to 2.93 million tones in 1995–96 and fall again to 2.89 million tones in 1996–97.
As for potassic fertilizer, the consumption slumped from 1.36 million tones in 1991–92 to 9.4 lakh tones in 1992–93, a 31 per cent drop. The next year it dipped further to 8.9 lakh tonnes. In 1994–95, consumption was 1.12 million tonnes and from then on it inched forward to 1.15 million tones in 1995–96 and 1.18 million tonnes next year. In contrast consumption of urea steadily rose 8.05 million tones in 1991–92 to 10.1 million tones in 1996 -97.
Decline in consumption of potassic and phosphatic fertilizers is primarily due to