Iran conflict may worsen urea shortage for Telangana farmers as LNG supply faces disruption

The Iran conflict could worsen the urea shortage in Telangana as LNG supply disruptions from Qatar threaten fertiliser production in India. Ramagundam Fertilizers and Chemicals Limited has already reduced output, raising concerns ahead of the upcoming kharif season

Dubai: The intensifying Iran conflict could aggravate the ongoing urea shortage in Telangana, where farmers have already been taking to the streets in protest over fertiliser scarcity. The situation may worsen ahead of the upcoming kharif crop season if disruptions in liquefied natural gas (LNG) supplies continue.

Fertiliser production in India depends heavily on imported LNG, which is a key feedstock for manufacturing urea. Any disruption in LNG supply chains could directly affect fertiliser availability. Qatar, the world’s largest LNG exporter, supplies nearly 40 per cent of the 27 million tonnes of LNG imported annually by India. According to reports, LNG production in Qatar was affected after one of its production facilities was targeted in an Iranian attack, forcing a shutdown. If the disruption continues, it could impact fertiliser production in India and intensify concerns among farmers.

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Ramagundam Fertilizers and Chemicals Limited (RFCL) in Telangana is among the 30 urea plants in the country that use LNG from Qatar as the primary feedstock for producing urea, the most widely used fertiliser in Telangana and several other States. RFCL has a daily production capacity of 3,850 metric tonnes of urea, with nearly half of the output allocated to Telangana.

According to reports, RFCL has reduced urea production by about 50 per cent following a 10 per cent cut in gas allocation under a rationalisation system introduced after supply disruptions from Qatar. Production could decline further if the conflict continues. LNG shipments destined for India pass through the Strait of Hormuz before reaching Dahej port on the Arabian coast of Gujarat. From there, the gas is transported to Ramagundam through the Mallavaram-Bhopal-Bhilwara-Vijaipur Gas Pipeline (MBBVPL) grid.

Telangana uses between 170 kg and 173 kg of fertiliser per acre, significantly higher than the national average of 100 kg to 120 kg. Major crops such as paddy and cotton cultivated in the State rely heavily on urea. Urea availability has already become a sensitive issue in Telangana, with shortages reported in several districts and farmers staging protests demanding adequate supply. The State consumed 20.07 lakh metric tonnes of urea in 2024-25, a high level largely attributed to the farmer-friendly policies of the previous BRS government, including Rythu Bandhu and the Kaleshwaram project.