Tender Entity: Indian Potash Limited (IPL)
Total Tender Volume: 2.5 million tons of urea (some reports mention 1.5 million tons for west coast + 1 million tons for east coast)
Bid Deadline: April 15, 2026
Shipment Deadline: All shipments must be completed by June 14 after winning the bid
Procurement Background: Due to Middle East conflict disrupting shipping through the Strait of Hormuz, coupled with domestic inventories of only 5.31 million tons (as of March 23), far below the safety line. With the summer sowing season approaching, demand is urgent.
Market Reaction and Results
Initial “Zero Bid” Rumours: Some media reported “zero bids”, citing reasons such as:
India’s offered price below international market cost (offers < $600/ton vs. CFR > $850–900/ton)
Harsh terms (very short delivery window, long payment terms, high penalties)
India’s long-standing commercial credibility issues (historical payment arrears, asset freezes, etc.)
Export quota restrictions in major exporting countries like China, prioritising domestic spring farming needs.
Actual Bidding Outcome: According to reports, as of April 15, approximately 5.9 million tons of bids were actually received (far exceeding the 2.5 million ton demand), with the lowest CFR offers:
East coast: $959/ton
West coast: $935/ton
This indicates that despite concerns, some suppliers still participated.
Current Impact and Outlook
Global Urea Prices: Driven by tight supply, Middle East granular urea prices reached $835/ton on April 10, up 73% from early March.
India’s Next Moves: With inventories continuing to deplete and the peak fertilizer season approaching, India may issue further tenders.
Impact on Chinese Enterprises: Although China currently maintains urea export restrictions, if quotas are relaxed in the future, domestic urea producers could benefit, especially given capacity utilisation at 85% and some room for exports.
Note: Tender term “CFR” (Cost and Freight) excludes insurance; actual landed cost needs to add war risk and other premiums, which have risen significantly under the current Middle East situation.