The Sri Lankan government has halted the import of all fertilizers and is moving to increase the use of organic fertilizer by 30 percent in the next three years.
Late last month President Gotabhaya Rajapaksa announced that the ban would come soon. This week, the government turned away two shipments of fertilizer from China. At the same time, the nation’s banks were ordered to not issue any new letters of credit for imported fertilizer.
Local media reported that the president first cited the negative health and environmental impact of non-organic fertilizer. Other sources said a need to limit the outflow of hard currency was also a factor in the decision.
Last year Sri Lanka imported a total of 659,000 mt of all types of fertilizers at a cost of US$188.6 million, according to Trade Data Monitor. The main import was urea, with the country bringing in 540,000 mt last year at a value of US$155 million.
Imports reported for the first quarter of the year, the latest available to Trade Data Monitor, showed total imports up about 26 percent to 78,500 mt from the same period last year at 62,000 mt. The value of those imports, however, jumped almost 30 percent, from US$18.7 million in the first quarter 2020 to US$24.2 million during the same time this year.
The main imports were urea, ammonium sulfate and MOP. Last year, Sri Lanka imported 97,000 mt of ammonium sulfate, 114,000 mt of MOP, and 540,000 mt of urea.
International fertilizer sources expressed concern that the conversion to organic fertilizer will have a detrimental impact on crop output. One trader said the nutrient content on processed fertilizers such as TSP and urea is much higher than organic substitutes. In some cases, this trader said, farmers will need to place 10 times the amount of fertilizer to achieve the same outcome using chemical fertilizers.
The government touted plans to work with Ceylon Fertilizer Co. to produce and distribute organic fertilizer in the near future. At the same time, it also announced that it would create an SSP production operation to serve as a substitute for the TSP it current imports. Sources estimated the TSP imports at just under 100,000 mt/year.
The domestic SSP operation, once built and operating, would be sourced by the country’s own phosphate rock reserves. However, international traders noted that the domestic reserves are not large.