Pakistan Fertilizer_a curious case of fertilizer shortage, (AKD Daily, Dec 21, 2021)
AKD Daily
Pakistan Fertilizer: a curious case of fertilizer shortage
- The issue of unavailability of urea has started to reach mainstream media where our channel checks suggest farmers being charged PkR2,300/bag—PkR2,400/bag as opposed to official price of PkR1,800/bag. The disparity in domestic and international prices of urea of ~PkR7,700/bag has being the primary reason affecting retail supplies of the commodity.
- The supply side concerns come at a time when the wheat sowing is in full swing posing risks to overall acreage of the crop which has been stagnant around 1.15MT/acre over the last many years, and to production target set for current season of 30mnMT.
- That said, we see limited risks materializing owing to better farm economics (as a result of bumper crops last season and favorable pricing trends) and increase in support prices. The support prices of the commodity has been revised up to PkR2,200/bag in Sindh and PkR1,950/bag by center.
- Country reported a bumper wheat crop last year of 27.3mnMT and also imported another 3.6mnMT to build buffers to manage end-user prices. Hence, we do not see price pressures in the immediate run, however realization of risks to wheat production target may hit the prices in the medium run.
AKD Research
Fatima Fertilizer Company Limited is a Pakistan-based fertilizer manufacturing company. The Company is engaged in manufacturing and marketing of Nitrogen, Phosphate and Potash fertilizers. It produces a range of fertilizers, including Sarsabz Calcium Ammonium Nitrate (CAN), Sarsabz Nitro Phosphate (NP), Nitrogen Phosphorous Potassium (NPK) and Sarsabz Urea. Its CAN is a granulated nitrogenous fertilizer. Sarsabz Urea can be applied in various forms and it can be spread in bulk alone or can also be mixed with other fertilizers before application. Its NP can be applied on various types of soils. The Company has a production base for Nitric Acid. The Company has annual production capacity of Urea 500,000, CAN 420,000, NP 244,000, Nitric Acid 500,000 and Ammonia 500,000. It also offers services and support to farmers from education on farming practices and research oriented agricultural practices.
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