KARACHI: During the first 10 months (January-October) of the current calendar year, 5.1 million tonnes of urea was sold as compared to 4.6m tonnes in the same period last year.
The fertiliser industry fulfilled the increasing domestic demand by supplying 10 per cent additional urea as compared to last year.
The industry is providing urea at a record discount of 83 per cent, equivalent to Rs8,500 per bag to international prices enabled by the Fertiliser Policy 2001.
Sher Shah Malik, Executive Director, Fertiliser Manufacturers of Pakistan Advisory Council, said in a statement as the local industry continued to ensure adequate and affordable supply of urea, an unprecedented level of discount to international prices has led to market manipulation and significant black marketing by middlemen/dealers.
While the urea industry’s maximum retail price is Rs1,768 per bag, the dealers in various parts of the country are fleecing the farmers by selling the commodity in excess of Rs2,000 per bag.
“I have informed the chief secretaries of Punjab and Sindh that fertiliser dealers needed to be deterred by the district administration from profiteering,” he said.
The perception of shortage of urea in the market was not real as the industry has already sold over 5m tonnes from January to October this year, a milestone never achieved in the past 10 years, Mr Malik said
Furthermore, with continued operation of RLNG plants and adequate inventory levels, the fertiliser industry would be able to meet the full year demand of 6.3m tonnes — a record in 10 years on the back of improved farm economics, he said.
The government has recently issued an import tender of 100,000 tonnes of urea while C&F prices are in the range of $900-1,000 per tonne.
Mr Malik said if the local industry did not play its role in ensuring adequate and affordable urea, imports of the fertiliser would have led to significant depletion of foreign exchange reserves and a sharp rise in the current account deficit.
He said the manufacturers have installed capacity of over 6m tonnes per annum of urea subject to availability of gas.
The government has aimed at maintaining 200,000 tonnes of buffer stock of urea in the country after inventory sales and it has issued import tender in view of 100,000-125,000 tonnes stock to avert any urea shortage, he said.