BIOFERTILISER UNITS

1. Introduction

1.1 Sustainable crop production depends much on good soil health. Soil health maintenance
warrants optimum combination of organic and inorganic components of the soil. Repeated use of
chemical fertilizers destroys soil biota. In nature, there are a number of useful soil micro
organisms which can help plants to absorb nutrients. Their utility can be enhanced with human
intervention by selecting efficient organisms, culturing them and adding them to soils directly or
through seeds. The cultured micro organisms packed in some carrier material for easy
application in the field are called bio-fertilisers.

1.2 Bio-fertilisers are living microorganisms of bacterial, fungal and algal origin. Their mode of
action differs and can be applied alone or in combination. By systematic research, efficient
strains are identified to suit to given soil and climatic conditions. Such strains have to be mass
multiplied in laboratory and distributed to farmers. They are packed in carrier materials like peat,
lignite powder in such a way that they will have sufficient shelf life. The list of commonly
produced bio-fertilizers in our country is given in Annexure1.

2. Major advantages of Biofertilisers

2.1 Biofertilisers enhance the nutrient availability to crop plants (by processes like fixing
atmosphere N or dissolving P present in the soil) ; and also impart better health to plants and soil
thereby enhancing crop yields in a moderate way. It is a natural method without any problems
like salinity and alkalinity, soil erosion etc.. In the vast areas of low input agriculture and oil
seeds production, as also in crops like sugarcane, etc, these products will be of much use to give
sustainability to production. In view of the priority for the promotion of organic farming and
reduction of chemical residues in the environment, special focus has to be given for the
production of biofertilisers.

3. Commercial prospects
3.1 The biofertilisers are mainly purchased by State Agriculture Departments and distributed to
the farmers at concessional rates. About 200 to 500 grams of carrier material is only needed per
acre, costing about Rs.10/- to 25/-. In view of the above, if the units are selected carefully, there
can be assured business. The benefits usually obtained by the use of biofertilizers will not be as
visible as that of chemical fertilizers. As the results are not dramatic, many farmers are not aware
of the significance, excepting in States like Maharashtra, Gujarat, parts of Karnataka and Tamil
Nadu, these are more commonly used with Government's support. In the context of increasing
awareness about the use of natural products and organic agriculture, these products will have
good scope. Further, the organically grown produces fetch higher prices both in domestic and
export markets.

3.2 It is estimated that the production of biofertilisers in the country by the existing units is about
7500 to 9000 TPA. This is far below the potential requirement of 7.6 lakh TPA by the year 2000-
2001 as estimated by the National Biofertiliser Development Centre (NBDC) Ghaziabad. So far,
the Ministry of Agriculture has supported establishment of 67 biofertiliser units in different parts
of the country.

Estimated potential Demand for Biofertilisers by 2000-2001

Type of Biofertiliser Demand

(Tonnes)
Rhizobium 34,999
145,953
Azotobacter 74,342
251,738
Azospirillum 255,340

Blue green Algae

Phosphate solublising microorgaanism

Total 762,372

3.3 This estimated demand of NBDC is based on the cultivated area of the country and treatment
of the total seed sown at the rate of 200g biofertiliser per 10 kg of seed. Although this
assumption reflects only the macro level requirement, even if 50% of the cultivated area is to be
brought under biofertiliser application, there will be a wide gap between the actual production
and the requirements. The current trends indicate that there is a steady increase in the demand in
the Southern states except Andhra Pradesh, Western States and Madya Pradesh and Rajasthan.

4. Biofertilser Technology

The technology used were indigenous and the scientific aspects of production are standardised
by Agricultural Universities and Research Laboratories of GOI.. Machinaries and laboratory
equipments are available from various manufacturers and are of BIS standards. The details of
technology are given in the Annexure 2.

5. Objective of Biofertilser Project

The primary objective of biofertiliser projects could be production of various strains of good
quality biofertilisers using most modern technology. The infrastructure and laboratory facilities
created, however, can be utilised for the production of bio - pesticides and bio control agents.
Multi product range will increase the viability.

6. Requirements of Biofertilser Projects

In line with the technology and objective of biofertiliser production, various facilities are
required for the successful implementation of such projects which are indicated below:

6.1 Land

It is required to set up laboratory and other facilities and office. Space may also be required for
installing tube well / dug well and parking of vehicles. A minimum of ½ acre of land is required
for setting up a 150 TPA unit. Preferably, the entire site should be fenced with barbed wire or
compound wall with gates at suitable places. The boundary may be planted with thick and tall
growing species like Asoka, to filter air and reduce dust.

6.2 Layout and buildings

The civil works comprises of factory building for laboratory, Carrier preparation and enrichment,
sterilisation, Inoculation and quality control, Maturation of culture, Mixing and packing, storage/
staff etc,. The total covered area of about 3000 sq ft is required for the product manufacturing
and other utilities. Rest of the area of land will be enough for future expansion up to 300 to 600
Tonnes per Annum.

6.3 Plant and Machinery

Manufacture of biofertilisers needs a good number of laboratory equipments as well as other

production facilities such as fermentors, culture medium tank, fermentor assembly, autoclaves,
boiler, broth dispensers for sterlisation, deminralising plant, air compressor etc,. The section wise
equipment required, their specifications, quantity required and average cost are indicated in
Annexure 4. All the machinery are manufactured in the country. Some of the suppliers undertake
the installing the units on a turn key basis.

6.4 Manufacturing process and Source of technology

The mother culture of various strains of biofertiliser are supplied from Agricultural Universities
and Regional Biofertiliser Development centres (MOA). The operations involved in the
manufacturing process are given in the form of a flow diagram (Exhibit 1). The unit generally
comprises of media preparation room, media store room, inoculation room, growth room, culture
transfer room, sterilization ,Mixing and packing, etc. The floor plan should be designed to
promote maximum efficiency and minimum contamination. The design should facilitate
maintenance of optimum temperature, humidity and ventilation. Inside air of the unit should be
free from dust particles.

6.5 Infrastructural Facilities for raw material, carrier material and utilities

The raw material required for biofertilser production include ingredients for growth medium for
the production of broth, carrier, packing materials like polythene packets. corrugated boxes, etc,.

Utilities :-

I) Power

Normally a three phase electric supply is required for these plants. The normal requirements of a
150 TPA unit is about 70 hp. Depending upon the position of power supply, stand by generator
may be needed.

Ii) Water

A Biofertiliser production unit requires water mainly for steam generation for sterlisation of
carrier, broth preparation and cleaning of equipments. Accordingly well/ bore well of designed
size and according to the quality of water demineralisation equipments are to be installed. The
average per day requirement of water for 150 TPA capacity will be about 2500 to 3000 liters

Iii) Compressed air

It will be required for various pneumatic operations as well as for controlled air supply to
fermenters, sterlisation / cleaning operations etc,.

Iv) Vehicles

The vehicles are required for procurement of carrier material and distribution of biofertilisers as
well as for office use . Accordingly one LCV and a jeep have been included in the project.

6.6 Manpower

For a unit manufacturing 150 TPA biofertilisers the requirements of manpower is as under :

1 Chief Executive Officer

1 Chief Biologist / Micro Biologist

1 Sales Officer

2 Accountant and clerical Assistant

2 Drivers

1 Floor Supervisor/ Factory Manager

2 Technical Staff ( boiler operation, mechanical maintenance, packing machine

operations, electrical maintenance)

2-3 Skilled labourers

4-5 Semi- skilled, depending upon the volume of production

7. Unit Size

The size of a biofertiliser unit could be expressed in terms of the capacity of production of
various types/ strains of biofertilisers per annum. The projects so far set up in our county vary
from 75 TPA to 300 TPA. The size envisaged in the present model is 150 TPA in one shift. The
capacity can be easily expanded by adding a few additional equipment like a fermenter and/ or
adding another shift.

8. Environmental Aspects and Pollution Control

No hazardous effluents are generated from a biofertiliser unit.

9. Business Prospects And Marketing and Selling Arrangements

9.1 Considering the importance for organic farming and promotion of sustainable farming
practices it is estimated that there will be further scope for adding new units, particularly in the
states of Maharashtra, Gujarat, Rajasthan, Madya Pradesh, Tamil Nadu, and Karnataka. The
biofertiliser products are picking up mainly in cultivation of sugarcane, pulses, cereals and
plantation crops. Since these crops are grown in vast areas, no problem in marketing is foreseen.
The units should establish market channels with such niche sectors. They can also have tie up
arrangement with government programmes like IPP, NODP etc,.

9.2 When a new entrepreneur intends to setup a project, a detailed market survey report is to be
prepared. The report may be prepared keeping in view the following aspects. may have to be
kept in view:-

1. the present and future demand - Cropping pattern in the supply for various products, gap
in supply and expected demand for various products.
2. the major competitors and their present share.
3. the projections of the unit for the next 3-5 years and the basis for projection.
4. the product wise quantities and places where it is to be marketed.
5. the market for the product and type of arrangements for distribution and sales,
commission and additional incentive to be given, the proposed net work and the
advertisement plans.
10. Capital cost of the project

10.1 Broadly, the capital cost includes the cost of land , development of land , fencing, civil
works (plant building, office, godown etc,.) Plant and machinery, preliminary and preoperative
expenses etc,. Capital cost of a model biofertiliser unit with a capacity of 150 TPA will be Rs.
73.473 lakhs. The project cost comprises of Rs 2.450 lakhs on land and land development , Rs.
13.500 lakhs on civil structures, Rs. 22.100 lakhs on plant and machinery , Rs. 21.850 lakhs on
account of misc. fixed assets, Rs. 3.000 lakhs on preliminary and preoperative expenses, Rs.
7.000 on vehicles, Rs.2.000 lakhs of contingency and Rs 1.573 lakhs of margin money for
working capital. The details of project cost are furnished in Annexure 4.

10.2 Ministry of Agriculture, Department of Agriculture and Cooperation, Government of India

is implementing a central sector scheme viz., "National Project on Development and use of
Biofertilisers". Under this project, a subsidy up to Rs.20 lakhs is provided for setting up a
biofertiliser production unit of 150 TPA capacity. It is proposed to release the subsidy through
back ended subsidy procedure. If the units are getting the subsidy, the amount will be adjusted to
the last few instalments of bank loan.

11. ECONOMICS OF THE PROJECT

Based on the various techno-economic parameters, the economics of the project have been
worked out for the project period or till the repayment of bank loan. The items of income
includes sale of biofertilisers. While the expenditure includes the cost of raw material,
transportation and commission, power, fuel packing distribution, wages and salary, repairs and
maintenance, insurance, advertisement and other overheads. The income as well as expenditure
for each year are worked out and subjected to cash flow analysis. For the model 150 TPA the
relevant techno-economic parameters are furnished in Annexure 3. The Income and Expenditure
statement is furnished in Annexure 5. The calculation of working capital requirements is given
in Annexure 6. The depreciation schedules on straight line method and written down value are
worked out and furnished in Annexure 7.

12. FINANCIAL ANALYSIS

The cash flow statement covering the Benefit Cost Ratio (BCR), Net Present Worth (NPW) and
Internal/financial rate of return (IRR/FRR) have been worked out for the project. Normally the
BCR should be greater than 1, NPW should be positive and IRR/FRR should be greater than
15%. For the model project under consideration, the BCR is 1.132 , NPW is Rs. 22.276 lakhs
and IRR is more than 15%. Calculation of IRR, BCR and NPW is given in Annexure 8. The
entire bank loan can be repayable in ten years including three year grace period during which
only interest will be recovered (details are given in Annexure 9).

13. FINANCIAL ASSISTANCE

The projects on manufacturing biofertiliser products would be considered for refinance support
by National Bank. Therefore, all participating banks may consider financing this activity subject
to their technical feasibility, financial viability and bankability.
14. LENDING TERMS AND OTHER REQUIREMENTS

14.1 Margin Money

The promoters/company should normally meet 25% of the project cost out of their own
resources.

4.2 Interest Rate

Interest rate will be determined by RBI/NABARD from time to time.

14.3 Security

As stipulated by the RBI.

14.4 Repayment Period

Depends upon the gross surplus generated, it may be up to 9 years with first one/two years as the
grace period.

14.5 Refinance Assistance

NABARD provides refinance assistance as per the existing pattern from time to time.

14.5 Subsidy

A subsidy ofd 25 % of the project cost will be given as subsidy by Ministry of Agriculture.

15. CHECK LIST

A check list of various points to be considered for feasibility of the project is appended in
Annexure 10.

*****

Annexure -1
LIST OF COMMONLY PRODUCED BIO-FERTILIZERS IN INDIA
NAME CROPS SUITED BENEFITS REMARKS
USUALLY SEEN
Rhyzobium strains Legumes like pulses, 10-35% yield Fodders give better
groundnut, soybean increase, 50-200 kg results. Leaves residual
N/ha. N in the soil.
Azotobacter Soil treatment for 10-15% yield Also controls certain
non- legume crops increase- adds 20-25 diseases.
 including dry land kg N/ha
crops
Azospirillum Non-legumes like 10-20% yield increase Fodders give
maize, barley, oats, higher/enriches fodder
sorghum, millet, response. Produces
Sugarcane, rice etc. growth promoting
substances. It can be
applied to legumes as
co-inoculant
Phosphate Soil application for all 5-30% yield increase Can be mixed with
Solubilizers* crops rock phosphate.

(*there are 2 bacterial

and 2 fungal species
in this group)
Blue-green algae and Rice/wet lands 20 -30 kg N/ha, Reduces soil alkalinity,
Azolla Azolla can give can be used for fishes
biomass up to 40-50 as feed. They have
tonnes and fix 30-100 growth promoting
kg N/ha hormonal effects.

TNAU has developed

high yielding Azolla
hybrids.
Microhizae (VAM) Many trees, some 30-50% yield increase Usually inoculated to
crops, and some , enhances uptake of seedlings.
ornamental plants P. Zn, S and Water.

Annexure 2

TECHNICAL ASPECTS OF BIO-FERTILISERS

What are Bio-fertilizers

1. Bio-fertilizers, in strict sense, are not fertilizers which directly give nutrition to crop plants.
These are cultures of micro organisms like bacteria, fungi, packed in a carrier material. Thus,
the critical input in Biofertilisers is the micro organisms. They help the plants indirectly through
better Nitrogen (N) fixation or improving the nutrient availability in the soil.

Mode of Action
2. The mode of action depends on the species of the organism. Some agents like Rhizobium
cultures enhance N fixation in legumes by imparting effective modulation as they are symbiotic
bacteria living in association with leguminous plants.

There are free living bacteria like Azotobacter when applied to soil, enhance the N availability.
There are certain other organisms which act on the soil minerals and dissolve the native
nutrients like P which is otherwise not readily soluble. The most commonly produced and
marketed biofertilizers are

1. Rhizobium - 3 to 4 strains
2. Azotobacter
3. Azospirillum
4. Phosphate Solubulizing Bacteria - 2 species.
5. Blue Green Algae and Azolla - on-farm level.
6. VAM - in a limited way.

Critical factors responsible for effectiveness

3. The critical factors which are responsible for the effectiveness of a particular bio-fertilizer are
as follows :

 Suitability of the species to the target crop

 Suitability of the strain : There are specific strains of rhyzobium for different leguminous
species like Cowpea, Redgram, Soybean, Alfalfa etc. Biofertilizer of specific culture
should be used for specific crop.
 Identification of strains as suited to the agro-eco system, particularly the soil PH and
moisture conditions. Through research, specific strains as suited to a particular soil and
environmental conditions are usually identified and pure mother cultures are maintained
in research labs for supply to the commercial manufacturers, e.g. germ plasm of
Rhizobium cultures is maintained at IARI, New Delhi.
 The aseptic conditions of manufacturing, the cell count of living organism present in the
carrier material, purity and level of contamination.
 The conditions of carrier material in which the culture is packed and the quality of the
packing material, which determine the shelf life.
 The conditions in which the packed materials are stored, distributed and kept with the
farmers before it is applied.
 Soil conditions particularly PH, organic matter content and moisture level; and
agronomic practices.

Level of Benefits

4. The benefits usually obtained will not be as visible as that of chemical fertilizers except in
some critical conditions. Biofertilisers can add nitrogen from 20 kg/ha to 200 kg/ha depending
upon the optimum conditions. Pastures and forages respond more than grain crops. The yield
increases usually range around 10-35%. However, in the vast areas of low input agriculture and
in the context of imparting sustainability to crop production at reduced chemical pollution, this
product will be of much use. Rhizobium culture treatment becomes essential when new types of
legumes like Soybeans are introduced in new areas. The range of benefits usually seen for
different organisms is also given in Annexure 1.

Other benefits

5. Application of biofertilisers should not be viewed from the only angle of nutrient supply to the
crops. They add life to the soil rendered sterile by the excess use of chemicals, etc. Some of them
possess growth promoting substances and also reduce the incidence of certain diseases. These
inputs are crucial if some one would like to take up organic farming.

The Outlines of Commercial Manufacture of Bio-fertilizers :

6.1 The manufacturing process in short involves

1. Selection of suitable strain of the organism for which market demand is identified.
2. Mass multiplication.
3. Mixing of the culture with carrier material and packing.

The steps involved are as follows :

Culture selection and maintenance:

6.2 The pure mother cultures of various strains are being maintained in Agricultural
Universities, IARI, some ICAR institutions, Regional biofertilizer labs of MOA, etc. There are
international sources of supply also like NifTAL, IRRI etc. The mother culture in test tubes of
desired strain can be purchased from the identified sources. They have to be further sub-cultured
and maintained purely for mass production by adopting standard techniques under the
supervision of trained microbiologist.

Culture augmentation:

6.3 In the next stage the culture has to be mass multiplied in two levels namely (i) at primary
level using shakers in flasks and (ii) Secondary stage multiplication in fermenters. The important
factor in this is the preparation of growing medium in which the culture is mass multiplied.
There are standard media on which information is available from published sources like Norris
& date, Fred et al, ISI approved etc. in case of Rhizobium. Similarly composition for growth
media are available for other cultures. After the media is formulated and sterilized in fermenter,
it is inoculated using the shorter cultures multiplied in the flasks at definite ratios usually 5%.
The bacteria growing medium is called broth and it is continuously aerated by passing sterile air
from compressors. After about 3-4 days fermentation period, the broth will be ready for packing
in a carrier material. At various stages the quality is tested by drawing samples.

Carrier sterilization:
6.4 While the broth is getting ready in the fermenter the carrier material, which is usually the
carbon source for the cultures to survive, is sterilized in autoclaves and kept ready for mixing the
broth. Peat imported from countries like U.S., Australia is reported to be the best source of
carrier material. However, as it is costly lignite is used extensively in India. The carrier is either
sterilized in bulk or it is packed and then the packets are sterilized.

Mixing and packing:

6.5 There are 2-3 alternatives depends upon the sophistication and automation of the unit.

1. Under non sterile system, the broth is harvested from the fermenter into sterilized carrier
- the mixing is done manually under aseptic condition and packed in polythene bags of
desired quantity.
2. In a slightly upgraded method, the broth and sterilized carrier are mixed mechanically in
a blender and the material is packed using semiautomatic packing and sealing machine.
In a slightly modified method some units are packing by delivering desired quantities of
carrier and broth simultaneously from separate pipe conveyance system in to the
polythene bags.
3. Under a completely sterile system the carrier is taken in autoclavable polypropylene bags
and pre sealed - into which the broth from fermenter is directly injected with the help of
dispenser. The injection hole is immediately sealed. The packets are kept in incubation
room for about a week before transferring to store room.

Sterile system of packing using auto syringe and dispenser is recommended to be the best method
and all new units should follow and adopt this system.

Equipment needed:

6.6 The main equipment needed for manufacture and lab are listed below. They are available
through scientific and lab equipment suppliers.

List of equipment

Name Approximate Purpose

quantity needed

1. Boiler/steam generator 1 big or 2 small To generate steam for sterilization

2. Autoclaves - Horizontal 1 For carrier sterilization

Vertical 2-4 For smaller quantities and small containers.

3. Rotary shakers (2 tier) 2 Culture growth

4. Fermenters 2 for culture fermentation

(500 lit capacity)

5. Laminar air flow -

work station of 6' size 2 for inoculation purposes

6. BOD incubator 1 for culture growth sterilization

7. Hot air oven 2 for dry glassware

8. Air conditioner 3-4

9. Refrigerator 2

10. Microscope 1

11. Balances 2-3

12. Dispensers or

Semi automatic mixing 2 sets with automatic injection systems

13. Sealing machine 1

14. Lab equipments: For quality control and microbial works

pH meter 1

Colony counter 1

Microscope 1

Fridge 1

15. Glassware As needed. Conical flasks are the major requirement

16. Distiller water unit or 1 set

Demineralization unit

17. Office furniture As needed

Layout of the production unit:

6.7 The biofertilizer plant should be housed in a suitable building complex. The main production
unit should have separate channels for bacteriological work, carrier making and mixing and
customer and visitor/marketing way. In addition there should be rooms with separate entrance
for utilities like power, steam generator and stores. Appropriate design can be adopted in
consultation with scientists/engineers.

Raw material:

6.8 The chief raw materials needed for the production of biofertilizers are as follows

 Mother cultures
 Carrier material - lignite or bentonite or peat of desired quality in powder form (70-100
mesh)
 Polythene bags, HDPE bags, cardboard cortans
 Growth materials - include Manital, sucrose and chemical nutrients.

Others:

6.9 In addition to the equipment given in para 6.6, the unit may also require 2 transport vehicles.
( 1 LCV and 1 Jeep)

Quality Control:

6.10 Though there are BSI standards for two species viz. Rhizobium (IS:8268-1976 and
Azotobacter (IS:9138-1979), there is no systematic quality certification system and monitoring
mechanism. It is entirely an internal arrangement and voluntary system as of now. As the
products being living microorganisms, the quality check up, certification batch-wise even if it is
internal is highly essential. Each unit should have lab infrastructure and plans/arrangements for
the same. Each unit, therefore should have the following facilities :

 adequate microbiological lab and qualified microbiologist.

 Sampling and testing at various stages of production, including the quality of raw
materials.
 Specify on the packets all the contents and cell counts. The source of mother culture and
the strain name should also be mentioned.
 The unit should fix their quality certificate and batch number, pack the products in
proper packing material.
 Store the products in cooler places till they are sold to farmers.
 Ensure to have aseptic conditions, cleanliness and contamination free production lines
and housing.
 Preferably use automatic and closed systems.

As per BIS specifications, certain tests are required to be conducted, like no of cells, colony
character, reaction etc. Cell number at the time of manufacture should not be less than 108 and
107 per gram of carrier material, respectively for Rhizobium and Azotobacter. Similarly, the
number of cell count and permissible contamination at expiry dates are also specified.
As certification arrangements are not in place at present, legislation for quality monitoring and
accredited labs for testing may be needed in future to ensure proper quality and promote this
products.

Limitations and constraints

6.11 The major limiting factors include:

 Narrow genetic base of mother cultures and lack of efficient and virulent strains suitable
to various agro-environments.
 Unsatisfactory carrier material with uniform and consistent good quality comparable to
imported peat material.
 Contamination in broth mixing and packing stages, not using completely closed system of
production.
 Unsatisfactory packing material which reduces shelf life.
 Unsatisfactory storing conditions, particularly during the distribution period. Exposure
to high temperatures and sunlight destroy the microbial culture. They should be
preferably kept in cold storage conditions.
 Not employing properly trained microbiologist.
 Lack of quality controls and certification procedures.

At field level: The efficiency when applied to soils is limited by several factors; most important
of them being., drought and high summer temperature, water logging, unfavourable soil pH,
antagonism from other organisms and nutrient deficiency. There is an acute awareness gap
among the farmers on the subject.

References

1. Biofertilizer - Technology, Marketing and usage, a source book-cum-Glossary by Dr. M

R Motsara et al(1995) - Fertilizer Development and Consultation Organization
publishers, New Delhi 110048 (India)
2. ISI standard IS: 9138-1979 (Specifications for Azotobacter)
3. ISI Standard IS: 8268-1986 (Specifications for Rhizobium)
4. Biofertilizers in Agriculture and Forestry by N S Subba Rao, Oxford & IBH, New Delhi.

Annexures

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