IFFCO's MD Patel eyes 10% growth in FY26 profit amid nano uptake woes

New Delhi: Indian Farmers Fertiliser Cooperative Limited (IFFCO) Managing Director K J Patel has projected a 10 percent net profit growth for FY26, even as the cooperative grapples with sluggish domestic adoption of its flagship nano fertilisers and intensifies farmer training programmes to unlock their potential.

In an interview to PTI, Patel, a four-decade IFFCO veteran who recently took over from U S Awasthi after his 32-year tenure, outlined a holistic strategy centred on the cooperative's "crown jewel"- its enduring bond with 36,000 cooperatives and over 5 crore farmers.

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"Our motto is to make sure that fertilisers are manufactured and they are also delivered to farmers with enough explanation how to use them, when to use them," said Patel, emphasising soil-specific guidance and quality seed advice aligned with Prime Minister Narendra Modi's goal of doubling farmers' income.

Four years after launch, nano fertilisers- touted as eco-friendly alternatives to chemical inputs - remain IFFCO's most exciting innovation and also its biggest challenge. Sales this year stand at 1.45 crore bottles of nano urea and 65 lakh of nano DAP, far below the 8-crore target.

In FY24, the total nano fertiliser sales were 3.64 crore bottles against production of 4.56 crore bottles. In contrast, conventional nitrogenous and complex fertilisers recorded sales of 1.13 crore tonnes against production of 0.93 crore tonnes.

Patel candidly admitted dissatisfaction with the 15 percent capacity utilisation at IFFCO's 29-crore-bottle annual output facility. "Unfortunately, we need to put in more efforts because we have not been yet satisfying our manufacturing capability," he said, citing low awareness and application hurdles like foliar spraying.

Trials by the Indian Council of Agricultural Research (ICAR), state universities and farmers have shown inconsistent yields and raised soil-food chain safety concerns. Critics question whether nano fertilisers primarily ease IFFCO's subsidy burden rather than benefit farmers.

Dismissing this, Patel countered that the Rs 2.5 lakh crore subsidy essentially covers imported raw materials like natural gas, sulphuric acid and rock phosphate. "My country is losing" to imports, he said, adding that nano fertilisers aim to stem this forex drain.

On the efficacy debate, Patel said third-party independent studies are "not of much importance to us." However, in a major transparency move, IFFCO has contributed Rs 4 crore to a Rs 70-80 crore ICAR-led, ministry-supervised five-year study on all nano products. Labs will be ready in six months for crop-soil-climate trials with public results. "Doodh ka doodh, paani ka paani ho jayega," Patel said.

To bridge the adoption gap, IFFCO is deploying more field assistants for village-level training on timing, seed treatments and sprayers. It is also subsidising drone services through "Drone Didis" - women pilots equipped with free drones, batteries and electric autos - and holding weekly marketing reviews to prevent misuse like blending nano with conventional urea.

Internationally, prospects appear brighter. IFFCO is building a new plant in Brazil, where response has been "too good," Patel said, with exports gaining traction.

As a farmer-owned cooperative prioritising reliability over profits, IFFCO posted 16 percent profit growth last year despite subsidy cuts and high gas prices, buoyed by joint ventures in Oman and Jordan, and Dubai trading arms. In FY24, net profit rose to Rs 2,823 crore with turnover growing 4.5 percent to Rs 41,244 crore.

For FY26, Patel projected 110 percent of last year's performance. "This year it will be 110 percent... I can say 10 percent more than the previous year. This is my target and so far we have been successful," he said, attributing the uptick to steady operations, JV dividends and subsidiaries.

Production upgrades are underway to tame energy costs, with AI integration at vintage plants like Phulpur and Kalol for efficiency and safety. Solar contracts for Kandla and Kalol aim for grid independence within a year.

A key milestone: nano NPK granular launch by April 2027 from a Rs 25-crore revamp at Kandla, with 80 percent equipment already onsite. Policy challenges

A persistent pain point is the 2014 scrapping of the Rs 2,300 per tonne urea fixed-cost floor, causing losses of thousands of crores for IFFCO's five cooperative plants. With the chief advisor's cost report under Fertiliser Ministry review, Patel remains hopeful for retrospective relief from April 2014. "The ministry is very open... we've submitted our facts and evidence," he said.

Beyond fertilisers, IFFCO has partnered in Sahakari Taxi, calling it "a great idea of the cooperative minister" that will benefit passengers, users and operators.

Looking ahead, Patel said IFFCO is developing new products for 2026 launch, including organic fertilisers, cow dung-based products and biochar. "We want to bring certain products which are most effective and will be very much needed to large group of farmers," he said.

From his predecessor Awasthi, Patel said he wants to carry forward three mantras: technical innovation, team spirit and nurturing cooperatives.

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