Urea sales jump 45% due to widespread rains

Fauji Fertiliser Bin Qasim posts highest growth in sales

KARACHI: Widespread rains throughout the country in the monsoon season led to a 45% jump in urea sales in August 2019 compared to the same month of previous year, according to the National Fertiliser Development Centre (NFDC).

NFDC reported sales of 625,000 tons of urea in August 2019 against sales of 431,000 tons in August 2018.

“The surge is mainly due to timely rainfall throughout the country,” said Sunny Kumar, analyst at Topline Research.

Overall, sales for the first eight months of 2019 came in at 3.97 million tons, up 8.8% from 3.66 million tons in the same period of previous year.

Among individual companies, Fauji Fertiliser Bin Qasim posted the highest growth of 32% year-on-year in urea sales in August as it sold 44,000 tons. It was followed by Fauji Fertiliser Company and Engro Fertilisers, which reported increase of 22% and 13% year-on-year to 233,000 tons and 186,000 tons respectively.

On the other hand, NFDC reported imported urea offtake of around 22,000 tons in August 2019.

Overall urea production in August 2019 depicted a growth of 17% to 569,000 tons against 486,000 in the corresponding month of previous year. “This is mainly due to the resumption of production by LNG-based players Fatima Fertiliser and Agritech, which cumulatively added 75,000 tons in August 2019 versus no production in August 2018,” said the analyst.

Total di-ammonium phosphate (DAP) sales came in at around 105,000 tons, up 33% year-on-year, while in the first eight months of 2019, DAP sales were down 10.4% to 953,000 tons against the same period of 2018.

Month-on-month data

On a month-on-month basis, urea sales increased 34.3% to 625,000 tons in August 2019 compared to 465,000 tons in July 2019.

“This growth is due to the lower base amid pre-buying done by farmers and dealers on expectations of a hike in urea prices in June,” said the analyst. DAP sales, however, decreased 48% month-on-month from 202,000 tons in July 2019 to 105,000 tons in August 2019.

The industry’s urea inventory at the end of August 2019 stood at 324,000 tons, while DAP inventory stood at around 418,000 tons.

Published in The Express Tribune, September 26^th, 2019.

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