Pakistan Fertilizer_Jul'21 urea offtake; FFC & FFBL lead the pack , (AKD Daily, Aug 26, 2021)
AKD Daily
Pakistan Fertilizer_Jul’21 urea offtake; FFC & FFBL lead the pack
- As per the numbers released by NFDC, urea offtake increased 9%YoY, but exhibited a decline of 10%MoM to 621K MT. This takes 7MCY21 urea offtake to 3.5mn MT, up 8%YoY. The overall urea inventory closed at 321K MT down 26%MoM, at par with the levels witnessed during the same period last year. Urea price, already up by c. PkR125/bag FYTD to PkR1,725/bag may sustain over 2HCY21 atleast, given supply side hiccups.
- DAP offtake increased 184%MoM but posted a decline of 23%YoY to 193K MT, taking 7MCY21 DAP offtakes to 794K MT, down 6% YoY. FFC led the pack with c. offtake in CY21TD up 65%YoY as opposed to 31/9% decline in EFERT/FFBL DAP offtakes, also being the outperformer in Jul’21. DAP inventory in Jul’21 closed at 400K MT, up 5% YoY, on the onset of seasonally pertinent 2H.
- EFERT offers highest D/Y in the sector where CY22/23F D/Y stands at 14.2/14.2% at last close, despite incorporating non-concessionary rates 3QCY21 onwards. For FFBL, strong profitability in 2HCY21 as well as one-time impact of conclusion of sell-off transaction of wind power projects will trigger price performance.
AKD Research
Fauji Fertilizer Bin Qasim Limited is a Pakistan-based holding company. The Company manufactures, purchases and markets fertilizers. It is involved in meat, dairy and coal based energy generation sectors. It has identified its potential business segments and has undertaken investments in the areas of food, financial, power sector and wind energy projects. Its products include Granular Urea, such as Sona Urea, and Di Ammonium Phosphate (DAP), such as Sona DAP. Sona Urea is a synthetic organic compound containing nitrogen in amide form available in the form of white solid prills. It is applied to soil and also suitable in solution form as spray application. Sona DAP contains nutrient element, phosphorous besides nitrogen available in flowing granular form Granules are stronger, harder and of uniform size. It is suitable for various crops and soils recommended for initial application. It produces over 791,260 metric tons (MT) of DAP and approximately 433,610 MT of Urea.
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