Global Urea Fertilizer Prices Down 66% in the Past Year

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Adi Ahdiat 04/05/2023 13:27 WIB

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According to World Bank data, global urea fertilizer prices fell 66% year-on-year (yoy) between April 2022 and April 2023.

Global Average Monthly Urea Fertilizer Prices (January 2020-April 2023)

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Global Average Monthly Urea Fertilizer Prices (January 2020-April 2023)

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Based on World Bank data, global urea fertilizer prices have significantly decreased in the last year.

In April 2022, the average global benchmark price of urea fertilizer reached USD 925 per ton, the highest ever recorded.

However, by April 2023, the average price had fallen by 66% (year-on-year/yoy) to USD 313.38 per ton.

Converted to Indonesian Rupiah, the global urea fertilizer price in April 2023 was equivalent to Rp4.58 million per ton (assuming an exchange rate of Rp14,627 per USD).

For 2023, the Indonesian government has prepared 4.64 million tons of subsidized urea fertilizer, with a highest retail price (HET) of Rp2,250 per kilogram or Rp2.25 million per ton, significantly cheaper than the global average price.

The government has allocated tens of trillions of Rupiah annually to subsidize fertilizers. However, according to Yeka Hendra Fatika, a member of the Indonesian Ombudsman, the results have not been optimal.

"The budget for fertilizer subsidies is around Rp33 trillion annually, or around Rp330 trillion in 10 years, but there is no impact on increased agricultural production," said Yeka in his article titled *Findings and Recommendations of the Ombudsman for Improvement of Subsidized Fertilizer Governance* on the official Ombudsman RI website (February 21, 2023).

According to the Ombudsman's study, there are also several potential instances of maladministration in the distribution of subsidized fertilizers in Indonesia, such as the lack of detail in the criteria for subsidized fertilizer recipients, inaccurate data on recipient farmers, issues with transparency in the appointment of official distributors, and ineffective supervision.

One case was found in Aceh Tenggara Regency. The Aceh Tenggara District Attorney's Office is currently investigating alleged corruption in the distribution of subsidized fertilizers in the region, which is estimated to have occurred during 2021-2022.

"This case has been transferred to the Special Criminal Unit (Pidsus) because there are indications of a markup in the selling price of subsidized fertilizers in the market or a deviation from the highest retail price (HET)," said Erawati, Head of the Aceh Tenggara District Attorney's Office, as reported by Serambinews.com on Tuesday, May 2, 2023.

Editor : Adi Ahdiat

"Disclosure: This is an AI-generated translation of the original article. We strive for accuracy, but please note that automated translations may contain errors or slight inconsistencies."