As imports have been delayed, subsidy mode is yet to be decided and domestic production is still a matter of conjecture Punjab braces for a tough fertiliser situation this rabi.
All early signs suggested that the domestic shortfall might range between 30-35 per cent of the total requirement, and the import of 185,000 tonnes decided by the Economic Coordination Committee of the cabinet (ECC) will still leave a big gap between supply and demand. It is feared that urea price may shoot beyond Rs2,000 per bag, and that of Di-Ammonia Phosphate (DAP) even more.
The genesis of the potential problem lies in the historical consumption pattern during the rabi season, when the country needs around 3m tonnes of urea. The ECC’s decision to import 185,000 tonnes of urea needs almost 90 days to get fully implemented, including placing orders, opening letters of credit, coordinating shipping processes, port handling and inland transportation; another two weeks might be added to the timeline if port is Gwader, instead of Karachi. The country needs both fertilisers (urea and the DAP) by end November or early December.
Another layer of urgency is added to the situation by the current floods. They have so far touched just under 3m acres of crops. Of these, they swept crops on over a million acres, where the farmers might go for early sowing rather than waiting for the damaged crops to re-grow. Wheat being the only next option in rice and cotton zones, this will inaugurate the rabi season early and so would be fertiliser application. Thus, instead of December, the fertiliser demand may rise by mid or late November.
If exports are not expedited, the prices of fertiliser will spiral because of huge deficit and the sowing may be delayed.
