Summary
Two plants of Fertilizer production will soon become operational in pakistan which will put Pakistan in a much better position as far as fertilizer production is concerned.
Analysis
Currently Pakistan is almost self sufficient in Urea production but as far as DAP and Potash fertilizers are concerned, the country meets the demand by importing these both fertilizers mainly bu Gulf and Arabic countries.
In a short period of time the country would be operating two new fertilizer plants, i.e M/s Fatima Fertilizer Plant in Rahim Yar Khan (a city in south of Pakistan) and M/s Engro Chemicals Plants at Dharki (a city in sindh province) are near to completion and expected to be operational by November 2009 and October 2010 respectively.
This means that the country would have to import less fertilizers from next year onwards.
Talking a little about urea, the market demand for urea has increased by 13 percent to 3 million tonnes during the first half of 2009, over the same period last year. During last year, demand stood at 2.7 million tonnes. This current increase was due to the better farm economics for wheat, which led to increased sowing and also improved urea application. Domestic urea production for the first half of 2009 was 2.4 million tonnes, which was 4 percent lower as compared to 2.5 million tonnes during the last year 2008.
The consumption potash is relatively low in pakistan but this does not mean the farmers are not interested in it. our framers are extracting potash from land as the natural potash plays a vital role in production of crops.
Over the years farmers were not inclined to use potash fertiliser properly due to almost equal or higher price compared to phosphorus fertiliser. If the government provides subsidy on potash fertiliser, its prices will fall to Rs1,900-Rs1,910 (USD 23)per bag, encouraging the farmers to increase its consumption. Currently, potash fertiliser prices are in the range of Rs2,600 to Rs2,700 USD 34) per bag. The country consumes 50,000 tons a year, which mainly comes from imports.
With the start of the two fertilizer plants, Pakistan will hopefully become self sufficient in Urea while imports for DAP and Potash would become less.
