Fertiliser stocks surge on Cabinet nod for new urea policy

Stocks of fertiliser companies surged by over 10% today after the Union Cabinet approved a new urea policy that aims to make the country self-sufficient in production in the next four years and ensure timely supply of the soil nutrient to farmers.

Shares of Rashtriya Chemicals and Fertilizers surged 10.26%, National Fertilizers (9.26%), Chambal Fertilisers & Chemicals (5.57%) and Gujarat State Fertilizers & Chemicals (4.63%) on the BSE.

Gujarat Narmada Valley Fertilizers & Chemicals rose by 3.89% and Zuari Agro Chemicals was up 1.85%.

India produces about 22 million tonnes (MT) of urea annually. At present, it imports about 8 MT of the fertiliser to meet the annual domestic demand.

"The Cabinet has approved a comprehensive new urea policy for the next four years aimed at timely supply of urea to farmers and rationalise subsidy burden," Press Information Bureau (PIB) Director General Frank Noronha said in a tweet after the Cabinet meeting held here.

The New Urea Policy 2015 has twin objectives: maximising urea production and promoting energy efficiency in urea units, he said.

The policy outlines measures for boosting urea production by making plants more energy efficient and pooling of gas supplied to urea facilities, among others, sources said.