Securing Bhutan’s fertilizers with the Hormuz disruption

2026-03-23 - 08:21

While all eyes have been on fuel prices and availability due to the Iran War and the disruption at the Strait of Hormuz, another important item that is also not getting through is a large amounts of fertilizers or the raw materials needed to produce them. There is already growing global concern about how a prolonged disruption could affect food security due to the shortage of fertilizers. One of the most affected countries is India, which is also the only source of Bhutan’s fertilizers. According to NDTV, 63 percent of India’s urea imports come from the Gulf and 32 percent of Diammonium Phosphate (DAP) comes from the Gulf with 42 percent of Potash coming from Saudi Arabia. According to The Economic Times, India is particularly concerned about urea, its most widely used fertilizer, as the conflict has reduced gas supplies used to produce nitrogen-based fertilizers. Just before the war, there was ample urea on the world market, with prices below USD 425 a ton, but now supplies are tight, and prices have risen above USD 600. Amid disruptions in the Middle East, China, a top fertilizer exporter, is tightening export restrictions. “We’ve got more stocks than last year, but if the war goes on longer, things could get tight,” said an Indian government source familiar with the matter to ET. India is talking to Russia, Belarus, and Morocco to increase purchases from them as the Middle East supply is stuck, and China is also tightening exports. Meanwhile, in Bhutan, fertilizers are critical for Bhutanese farmers as they help improve soil fertility, increase crop productivity, and support national food security. Timely import and supply are particularly important because fertilizer use is highly seasonal. If fertilizers are not available during the planting period, farmers may miss the entire cropping cycle for that year, said the Ministry of Agriculture and Livestock (MoAL). For key crops such as potato, paddy and maize, fertilizer application is essential to achieve adequate yields. In many high-altitude regions, potato is often the primary cash crop, and maintaining high productivity is vital for farmers’ incomes and livelihoods. Over time, fertilizer use in Bhutan has remained consistently important for farmers, who often set aside part of their annual income to purchase fertilizers for the next cropping season. The largest demand for fertilizers in Bhutan comes from potato cultivation, where the majority of basal fertilizers are applied. Around 70 percent of Suphala and 100 percent of both SSP (Single Super Phosphate) and MoP (Muriate of Potash) are used for potato production. Major potato-growing regions include Phobjikha, Sephu, Bumthang, Haa, Chapcha, Paro, and Thimphu. The remaining 30 percent of Suphala is mainly applied as a basal fertilizer for paddy, orchards, and vegetable cultivation, particularly in the southern, western, and central regions of the country. For urea, about 80 percent is used as top dressing for maize in the six eastern dzongkhags, while the remaining 20 percent is applied to paddy fields in Wangdue, Punakha, Paro, Thimphu, and the southern regions. Overall, the major crops requiring fertilizers in Bhutan are potato, maize, and paddy, with demand concentrated in the eastern maize belt, potato-growing highland regions, and paddy-producing valleys and southern areas. Fertilizers are imported annually, with total quantities ranging between 2,800 and 3,000 metric tons (MT) depending on national demand. The main import period is between December and February, in preparation for the upcoming planting seasons. The fertilizers are imported and supplied in batches throughout the year to ensure continuous availability. The MoAL said at present, there is no disruption to Bhutan’s fertilizer supply due to the Iran War. Current shipments for Bhutan had already been arranged earlier and are already in transit, which has helped avoid any immediate impact. However, the regional fertilizer market is experiencing some pressure, particularly for urea, due to reduced imports into India from China. For Bhutan, the impact so far is limited where there was temporary delay in the supply of urea and Suphala according to Bhutan’s supplier, Swastik Trading Co., India, but the pending consignments did make it later. All 450 MT of consignment was received comprising urea, Suphala, borax and single superphosphate and stored in Phuentsholing. The MoAL said the situation is being closely monitored, and they remain in coordination with the supplier to ensure timely availability of fertilizers for the upcoming planting season. There has been no increase in fertilizer prices. The current price structure has remained unchanged for the past five years, following the adjustment made during the 2021–2022 financial year. So far, no notification of a price increase has been received from the supplier. Therefore, the government continues to maintain the same price structure that has been in place over the past five years. Prices will remain unchanged unless there is a revision at the source or from the supplier. Urea costs Nu 1,524 for a 50 kg bag, Suphala costs Nu 3,016 for a 50 kg bag, SSP costs Nu 1,740, DPA costs Nu 2,405 and MOP costs Nu 3,335 per bag. Of the fertilizers the highest usage is for urea. An additional 1247 MT of consignment has been ordered which is expected to be delivered in 10-15 days. There are no price spikes on the consignment delivered. Of this Urea is 797 MT, Suphala is 250 MT, SSP is 200 MT. The consignment will be enough to meet fertilizer requirements for maize and paddy until June 2026.