Indian DAP stocks edged up to 1.96 million t over May as a boost in domestic production and imports helped offset the uptick in demand, reported Argus Media.
Combined imports and domestic output outpaced offtake in May, raising stocks by 33 000 t on the month, the latest data from the Fertilizer Association of India (FAI) showed.
India started May with 1.93 million t of DAP in stock.
May domestic output was at 393 000 t, the highest of any month since August 2024, according to FAI data. In the face of bullish international DAP prices, domestic production margins are almost US$200/t more attractive when using ammonia and phosphoric acid than importing DAP as of the week starting 15 June.
The FAI data showed an increase in May imports to 132 000 t compared with underwhelming arrivals in March and April. But May’s total is only approximately a third of average 2021 - 2025 May imports at 393 000 t. The lack of clarity on whether importers will be compensated by the government for their losses, coupled with steep price increases since the start of the US-Iran war, have dampened import interest.
Domestic sales seasonally rose to 492 000 t in May, but the total remains below the 573 000 t five-year average for the month.
More imports needed ahead of 4Q26
Indian importers will have to intensify their DAP purchases in the coming months, as domestic demand will rise seasonally over 3Q26 and peak in 4Q26.
Margins for the production of DAP with phosphoric acid may worsen next quarter on the back of expectations of higher phosphoric acid prices. Producers and traders envisage a significant price increase from the second-quarter settlement at US$1360/t P2O5 cfr as sulfur costs have continued to rise over the second quarter while supply has dried up.
A lack of ammonia stocks helped Indian importers secure a lower-than-expected 2Q26 phosphoric acid settlement, but improved ammonia supply over the 2Q26 is likely to weaken importers' hands in negotiations for 3Q26.
Indian importers are expected to soon emerge with fresh demand for DAP. The apparent de-escalation of hostilities around the Strait of Hormuz raised the prospect of softer DAP prices and delayed Indian import demand.
TSP stocks fall on lack of imports
Indian TSP demand rose to 59 000 t in May, while no imports were recorded for the third month in a row, causing stocks to fall to 314 000 t.
Stocks are due to improve with new arrivals of 100 000 t of Moroccan TSP bought at the start of the month for shipment in June-July, and another 100 000 t from OCP for loading in June.
Read the original news release written by Adrien Seewald on Argus Media.