The urea inventory had gone up to 14 lakh tonnes recently due to poor sales throughout the country, particularly in central India because of about 20 days delay in rains and scanty rainfall in other areas, the company sources said.

The situation also worsened due to large-scale floods witnessed by Bihar and neighbouring areas during the last rabi season which resulted in huge opening stock of urea in the current kharif season as the consumption was quite low, they said.

IFFCO has now started aggressive marketing exercise to dispose of the inventory which is also posing a storage problem in this rainy season.

The company officials hope that the situation would be normalised soon as there were expectations of better rains in days to come.

Sources pointed out that cooperative structure of the company was also responsible for poor sales of fertilisers to some extent as IFFCO could not sell fertilisers in the open market like any other private producer and rather depend on the cooperative network.

Sources said not only IFFCO but other producers were facing the inventory problem as demand for the fertiliser was low at present.

Other fertiliser cooperatives such as krishak Bharti Cooperatives Ltd (Kribhco) and some of the private producers were also finding it difficult to store excess fertiliser, sources said.

Piling up of inventory at IFFCO godowns was also due to increased production following commissioning of four fertiliser expansion projects in the last three years.

With the commissioning of Aonla, Phulpur, Kalol and Kandla expansion projects, production capacity of the cooperative has doubled to 52 lakh tonnes from 26 lakh tonnes per annum.

Additional capacity created at all the four plants would increase country's foodgrains production by about 26 million tonnes, they said.

IFFCO produced a record 36.15 lakh tonnes of urea and 13.06 lakh tonnes of NPK/DAP fertilisers in 1998-99, totalling a quantity of 49.21 lakh tonnes as against the previous best of 41.6 lakh tonnes in the previous fiscal.

During the last fiscal, the cooperative registered the highest ever sale of 33.42 lakh tonnes of urea as compared to 27.57 lakh tonnes in 1997-98.