NEARLY TWO years after the government made neem-coating mandatory for urea sold in India, questions are being raised over how much of neem oil used for this purpose is genuine. Roughly 800 grams of neem oil is required to coat one tonne of urea. For the estimated 310 lakh tonnes (lt) of urea annually consumed, that works out to about 25,000 tonnes. In terms of fruit from which the oil is extracted, it translates into around 3.25 lt, considering the average recovery rate of 11 per cent after transportation and post-storage weight losses of around 30 per cent.
Now, the question being asked is: Where is all this oil and fruit coming from, given that there’s not much organised cultivation of neem trees in the country and ripened fruit is available for barely two months of the year, from May-end till mid-July? Also, with no real systems in place for collection, drying and processing — except for a few fertiliser companies — how much of “genuine” neem oil is being sprayed on urea bagged in plants and ports across India? Read | Empowering through Nimboli: The story of a mini-rural entrepreneur Laxmiben
Speaking to The Indian Express, a top government official admitted, “It is a sensitive issue, more so when the decision (to go for 100 per cent neem-coating for domestically produced and imported urea) came right from the top.” On April 27, the Department of Fertilisers issued a circular, stating that “some neem oil suppliers are offering more quantity of neem oil to urea manufacturers/ importers than their neem oil production capacity, which encourages malpractices and mixing of spurious oil in neem oil with azadirachtin powder”. Fertiliser firms have since been directed to procure only from “genuine” neem oil manufacturers, who would have to provide details of their actual production capacity and existing supply commitments while bidding for purchase tenders.
Now, the government is planning to tighten the screws further — by changing the specifications for neem oil used in urea-coating to ensure its “purity”. The existing specifications require the oil to have a maximum of one per cent moisture and insoluble matter by weight; specific gravity of 0.85-0.95 at 30 degrees Celsius; iodine value of 65-95; saponification value of 160-205; and, a minimum azadirachtin content of 150 parts per million (ppm). There are many vegetable oils — including washed cottonseed, rice bran, karanja, and palm — and even cutting (transformer) oil that can more or less meet the above values, barring the one relating to azadirachtin, the main active ingredient in neem. These oils are relatively cheap, costing Rs 55-65 per kg.
On the other hand, the cost of neem fruit delivered to a processing unit is currently in the range of Rs 16,000 per tonne — processing costs of Rs 3,000 takes this to Rs 19,000. At 11 per cent recovery, and after deducting realisations from sale of the 85 per cent residual cake left after extraction (Rs 6,800, at Rs 8 per kg for 850 kg), the average net cost of neem oil comes to Rs 111 per kg. Within this, the cost of the primary expeller oil (which has a higher azadirachtin content of 400 ppm or more) would be Rs 120-130 per kg, while that for oil which is solvent-extracted from the cake (having only 100 ppm azadirachtin) would be Rs 80-90.
“There are suppliers who are using a mix of 70-80 per cent vegetable oils (average cost of Rs 60 per kg) and 20-30 per cent solvent-extracted neem oil (Rs 80 per kg). To this, they add one gram or so of azadirachtin powder costing Rs 9-10. The resultant so-called neem oil would meet all the specifications required for urea-coating, including the minimum 150 ppm azadirachtin content. And it will cost less than Rs 75 per kg, while being supplied to urea manufacturers/importers at Rs 100-plus (the current quoted rates for neem oil in most tenders),” said the government official.
One way to handle this, he said, would be to change the specifications for neem oil to be used for coating of urea. “Azadirachtin apart, neem also has other compounds such as nimbin and salannin. We could lay down minimum values for these as well. These can be decided by the relevant technical bodies,” said the official. All this, however, does not take away the overall success of the neem-coating programme. Being heavily subsidised, urea was used as a binder by plywood/particle board makers and for sizing (smoothening) textiles, besides being a common adulterant in milk. Such illegal diversion for non-agricultural applications is seen to have largely come down with neem-oil coating.
Coating also enables a more gradual release of nitrogen which, in normal urea, is prone to losses through ‘leaching’ (underground percolation) and ‘volatilisation’ (escaping into atmosphere). The resultant higher nitrogen-use efficiency has translated into lesser bags of urea being consumed on farms. Both together — reduced diversion and improved nutrient-use efficiency — have led to urea sales in India falling from 319.74 lt in 2015-16 to 296.07 lt in 2016-17, despite agricultural production going up, said the official.