KARACHI:
Caretaker Prime Minister Anwaarul Haq Kakar has directed authorities concerned to launch a crackdown on fertilizer hoarders, smugglers and speculators, stating that there is enough available stock of urea for the current wheat season in the country.
A statement from the PM Office Media Wing by APP, Press Information Department (PID), Karachi, said, “Caretaker Prime Minister Anwaarul Haq Kakar said on Monday that enough urea fertilizer was available in the country to meet the requirements and directed the initiating legal proceedings against those involved in its hoarding and illegal profiteering. Those who exploit farmers by stockpiling urea fertilizers will not be spared.”
“The meeting was informed that for the buffer stock, a total of 2 million metric tonnes of urea will be imported,” according to the statement.
Addressing the participants, the caretaker chief minister mandated easier and seamless supply of fertilizers to farmers and called for strict supervision on its demand and supply. He also directed the relevant federal ministries to ensure their assistance to the provincial governments in the action taken to control the issue of hoarding by providing details of fertilizer demand and supply. At the end of November 2023, the Economic Coordination Committee approved the import of 220,000 tons of urea from Azerbaijan, it was reported.
Speaking to Express Tribune, Optimus Capital Management research analyst Areeba Nasir said that Pakistan is supplying urea fertilizer at a significantly discounted price to its farmers compared to its price in international markets. This sometimes enables smugglers to sell the commodity in expensive markets across the border.
Reading Fertilizer shortage grips Sindh during the sowing season
“Urea was available at a discount of 31% in Pakistan in November compared to global markets,” he estimated.
Sharing the latest sales and inventory numbers for the wheat sowing season (October-December 2023) in Pakistan, the analyst said that there was enough stock of urea fertilizer in Pakistan despite its stocks being noted in the country. “There is no shortage of urea fertilizers actually. the crisis is artificial”.
“The scheduled import of 220,000 tonnes, which was to reach Pakistan from December 20, 2023, may help normalize the price,” he said. He said domestic urea manufacturers sell the fertilizer to dealers at Rs 3,400/50 kg bag. This should be available to farmers at Rs 3,500-3,600/bag. Fertilizer, however, is being sold for as much as Rs 5,000/bag in some parts of the country due to hoarding and possible smuggling these days.
He said the price of urea has increased by about Rs 1,000/bag in the last one year. It sold at an average of Rs 2,471/bag at retail this time last year. “The increase in natural gas prices during the year caused a rise in fertilizer prices in the country (as gas remains a raw material in fertilizer production).”
He said DAP fertilizer is available at Rs 13,000/bag at retail these days. Its price remains close to that of international markets, as the country mainly meets its requirements through imports. He said companies sold 1.8 million tonnes of urea during the three-month wheat sowing season last year. This year, they have so far sold 1.069 million tonnes in the first two months (October-November). Figures for December 2023 are not yet available.
Published in The Express Tribune, January 2n.d2024.
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