Fertilizer offtake falls by 34% YoY in July

August 26, 2022 (MLN): The country’s overall nutrients offtake fell by 34% to 310,000 tonnes during July 2022 compared to the same month last year, the latest monthly report of fertilizer offtake issued by the National Fertilizer Development Company (NDFC) showed today.

Among the nutrients, nitrogen and phosphate offtake decreased by 26.7% YoY and 56% YoY to stand at 262,000, and 47,000 tonnes, respectively during July 2022. While Potash offtake also moved down by 78.7% over July 2021.

The report underlined that about 652,000 tonnes of different fertilizer products were produced in Pakistan during the month of July 2022. The major share was of urea (63.2%) with 412,000 tonnes.

Other products were DAP (76,000 tonnes), Nitrophos (73,000 tonnes), CAN (74,000 tonnes), SSP (5,200 tonnes) and various grades of NPK (12,000 tonnes). Total imported supplies were 35,000 tonnes comprising 33,000 tonnes of DAP, 1,900 tonnes of SOP, and a small quantity of AS i.e., 900 tonnes during July 2022.

UREA

The total sales of urea stood at 463,000 tonnes in July 2022, showing a decline of 25.6% when compared to July 2021.

Total urea availability during July 2022 was 668,000 tonnes, which comprised 256,000 tonnes of the previous month's leftover and domestic production of 412,000 tonnes. Urea offtake during July 2022 was 463,000 tonnes while leaving behind 205,000 tonnes of opening stock for August 2022.

Meanwhile, the price of a 50 kg bag of urea (sona) in the domestic market during the said month jumped by 10.6% MoM to Rs2,376 while the price of urea (other) went up by 13.4% to Rs2,258 over June 2022.

In the international market, Fob bulk China urea price was quoted as $470-550/t during July 2022. Arabian Gulf prilled urea price ranged between $485-600/t fob. The price of imported urea was in the range of Rs. 6,710 to 8,293 per 50 kg bag.

Province-wise, urea offtake declined in Punjab, Sindh, and Balochistan by 19%, 44%, and 48% respectively, as compared with July 2021. On the other hand, its offtake increased by 41% in KP over the same period the previous year.

During Kharif 2022 (April-July), urea offtake was 2,076,000 tonnes, showing a decrease of 2.2% against the same period of Kharif 2021.

Urea availability during Kharif 2022 was estimated to be around 3,448,000 tonnes comprising 200,000 tonnes of opening inventory, 200,000 tonnes of imported supplies and 3,048,000 tonnes of domestic production.

Moreover, total urea offtake is projected to be around 3,244,000 tonnes leaving a balance stock of 199,000 tonnes of urea for coming Rabi 2022-23, the report added.

DAP

The sales of diammonium phosphate (DAP) witnessed a significant drop of 65.3% to 67,000 tonnes in July 2022, against 193 tonnes recorded in the same month last year.

As per the report, total available DAP during July 2022 was 446,000 tonnes comprising 337,000 tonnes of opening balance, 33,000 tonnes of imported supplies and 76,000 tonnes of domestic production. DAP offtake was 67,000 tonnes leaving a balance of 374,000 tonnes for August 2022.

The price of a 50 kg bag of DAP in the domestic market during the said month jumped by 17.5% MoM to Rs12,120 when compared to Rs10,316 reported in June 2022, it added.

In the international market, DAP prices were in the range of $890-950/tfob bulk in Australia and $910-940/t fob in China market.

Province-wise, DAP offtake during the review month moved down in Punjab, Sindh, Balochistan, and KP by 67%, 61%, 45%, and 60%, respectively over July 2021.

DAP offtake was 402,000 tonnes indicating a 16.4% decrease over the same time frame of Kharif 2021. To note, the offtake of DAP is experiencing a downward trend due to price escalation.

Kharif, 2022 started with an opening balance of 276,000 tonnes. Domestic production during the season is estimated to be 448,000 tonnes and imported supplies will be around 160,000 tonnes. Thus, the total availability of DAP will be around 864,000 tonnes.

The report highlighted that the offtake for DAP during Kharif 2022 is estimated to be around 571,000 tonnes, leaving a balance of 349,000 tonnes for the upcoming Rabi season.

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