Crackdown against urea hoarders, smugglers brings farmers relief

September 27, 2023 (MLN): The government’s crackdown against urea hoarders and smugglers has started to yield favourable results as the market prices for farmers have started to normalize and reduced by around Rs500 to Rs600 per bag.

Last week, the Interim Interior Minister Sarfaraz Bugti initiated strict action against culprits involved in the smuggling and hoarding of essential commodities, like wheat, sugar, urea and oil.

According to an interior ministry report, more than 90 middlemen were involved in hoarding activities that caused artificial shortages and an increase in fertilizer prices.

Media reports about recent raids suggest that around 90,000 bags of fertilizers have been confiscated from various parts of Sindh, while more than 85,000 bags of fertilizers have also been recovered from different warehouses in Mirpurkhas.

Due to these illegal activities of hoarding and smuggling, urea prices had surged to as high as Rs4,200 per bag in various parts of the country compared to the retail price of Rs3,100 to Rs3,400 per bag.

The artificial shortage has been created despite the government’s hectic efforts to ensure uninterrupted gas supplies to all fertilizer plants so that they operate at full capacity to meet the estimated annual urea demand of 6.8 million tons.

Appreciating the swift action of government authorities against illegal activities of hoarding and smuggling, Brig Sher Shah - Executive Director of Fertilizer Manufacturers of Pakistan Advisory Council (FMPAC) stated, “The local fertilizer industry has always strived to ensure adequate and affordable supplies of urea for the farmers."

Some culprits in the market at places are involved in profiteering by selling urea around Rs 800 to 1,000 higher than the official price. Such illegal activities may force the farmers to pay additional Rs100 billion on fertilizer purchases in 2023, he added.

He also commended the efforts of Dr. Ijaz Gohar, caretaker Federal Minister for Commerce, Industries and Production, to ensure uninterrupted gas supplies to the fertilizer sector.

“The availability of consistent gas supplies would ensure sufficient fertilizer stocks for the upcoming Rabi season. The crackdown against hoarding and sufficient production would help ensure a higher yield of wheat that is so essential for the food security of Pakistan”, he said.

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