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Neem coated urea not only increase crop yield but also lower input cost to the farmer. Cost of neem coated urea is only 3-4% higher than ordinary urea. Urea constitutes about 82% of the fertilizer nitrogen (N) used in India. Neem coated urea has been observed to improve nitrogen use efficiency and subsequently crop yield, especially in rice and wheat. Nitrification inhibitors when applied along with urea reduce losses of applied N thereby resulting in an improved yield of crops. In rice and wheat more than 50% of the urea consumed in India is applied, the mean increase in grain yield by replacing urea with NCU or NOCU is 5 to 6%. More than 75 studies have been conducted to compare the performance of urea coated with neem cake (NCU) or neem oil (NOCU) in increasing the yield of rice, wheat, and several other crops via uncoated urea. In 2015, the Government of India directed that all fertilizer urea manufactured in the country or imported will have to be coated with neem oil at the rate of 0.5 kg per tonne. This decision was motivated not only by the better performance of NOCU via uncoated urea but also by an expectation that it will lead to reduced consumption of urea. Increasing nitrogen efficiency means-reducing the nitrogen losses through leaching, immobilization and reducing groundwater pollution by nitrates as well as ammonia gas pollution in the air. It also reduces import of costly fertilizers as well as reduces ground, water, and soil pollution.

Impact of neem coated urea on rice yield and nutrient use efficiency (NUE)