India's Urea Import Tender Clears at $390/Tonne, Undercutting Pre-Iran War Prices

Rashtriya Chemicals and Fertilizers (RCF) has received offers from 30 suppliers in its latest urea import tender, which seeks 1.7 million tonnes split across the East Coast (700,000 tonnes) and West Coast (1 million tonnes), with all shipments required by September 24.

The lowest bid came from Ameropa, which quoted $390.25 per tonne (CFR) for 165,000 tonnes to the East Coast and $393.65 per tonne for 226,000 tonnes to the West Coast. Multiple other traders — including Agro Fertilizer International, Agrifields, Continental, IndAgro, Koch Fertilizer, Midgulf, Saftco, and Sun International — also submitted East Coast offers below the $400 threshold.

The highest offer in the tender came from Chasemax, which quoted $431 per tonne for 50,000 tonnes exclusively to the West Coast, illustrating a roughly $41-per-tonne spread across the field of bidders.

In terms of sheer volume, the Aditya Birla Group emerged as the biggest bidder, offering to supply 300,000 tonnes to the East Coast at $404.30 per tonne and a further 400,000 tonnes to the West Coast at $411.50 per tonne — a combined 700,000 tonnes across both coasts.

Midgulf submitted the second-largest volume offer, quoting $393.10 per tonne for 250,000 tonnes to the East Coast and $396.45 per tonne for a matching 250,000 tonnes to the West Coast. Midgulf's pricing placed it firmly in the sub-$400 bracket for both destinations, making it among the more competitive large-volume suppliers in the round.

The wide spread between the volume leaders' pricing and the lowest bids reflects the competitive but fragmented nature of the current international urea market, where supply routes and origins continue to vary significantly post-war.

The scale of the price correction since the outbreak of the Iran-US war is stark. India's first post-war tender saw urea purchased at $959 per tonne — more than double pre-war global levels, which were already above $400 per tonne.

The June tender offered some relief, with prices ranging between $444 and $605 per tonne, but the current round's sub-$390 bids represent a further dramatic decline — and now sit below pre-war benchmarks.

Industry sources attribute the correction to demand destruction: as prices surged in the immediate aftermath of the war, buyers globally pulled back, weakening overall demand and placing sustained downward pressure on international urea prices. The reversal has been swift, though the geopolitical situation remains a live variable that could reintroduce volatility.

The fiscal implications of falling urea prices are considerable. When urea spiked to $959 per tonne post-war, concerns mounted that India's fertiliser subsidy bill could exceed ₹3 lakh crore in the current year — nearly double the budgeted estimate of ₹1.77 lakh crore.

However, with further imports now expected to be procured at significantly lower rates, estimates suggest the subsidy bill is likely to remain well below ₹3 lakh crore. India is the world's largest urea importer, which means international price movements translate directly and materially into the government's subsidy outgo.

The outcome will ultimately depend on the total volume imported, the blended average price across all tenders during the year, and whether global urea prices hold at current levels or face fresh disruption — making the next few tender cycles closely watched by both the government and agri-input industry.