Urea off-take down 12% to 3.7 million tons
Local urea demand declines 50% in September due to floods and imports.
KARACHI:
Cumulative urea off-take for the first nine months of 2012 registered a decline of 12% to 3.7 million while di-ammonia phosphate (DAP) off-take fell 2% to 631,000 tons in the same period, latest statistics from National Fertlizer Development Centre shows.
In September 2012, total urea off-take declined 50% while DAP off-take registered a sizable 68% increase.
Lower urea off-take during the month was attributable mainly to flooding in late July 2012 and price speculation ahead of the latest batch of urea imports, said Shajar Capital investment analyst Raza Hamdani. DAP off-take; on the other hand, surged during the month due to massive inventory liquidation by Fauji Fertilizer Bin Qasim (FFBL) following a Rs100 per bag price cut, added Hamdani.
During the Kharif season, urea off-take stood 11% lower to clock in at 2.7 million tons, where lower cultivation (ex-cotton) amid a 18% price hike, power outages and water availability concerns led to lower application during the season.
Among major fertilizer players, FFBL and Engro faced a 42% and 38% decline in urea off-take in the period under review respectively, while cheaper imported urea accounted for 27% of the total market.
With Rabi season of 2013 crop cultivation in full swing, analysts expect off-take, particularly of DAP, resulting in better profitability for DAP players.
Published in The Express Tribune, November 1st, 2012.
Cumulative urea off-take for the first nine months of 2012 registered a decline of 12% to 3.7 million while di-ammonia phosphate (DAP) off-take fell 2% to 631,000 tons in the same period, latest statistics from National Fertlizer Development Centre shows.
In September 2012, total urea off-take declined 50% while DAP off-take registered a sizable 68% increase.
Lower urea off-take during the month was attributable mainly to flooding in late July 2012 and price speculation ahead of the latest batch of urea imports, said Shajar Capital investment analyst Raza Hamdani. DAP off-take; on the other hand, surged during the month due to massive inventory liquidation by Fauji Fertilizer Bin Qasim (FFBL) following a Rs100 per bag price cut, added Hamdani.
During the Kharif season, urea off-take stood 11% lower to clock in at 2.7 million tons, where lower cultivation (ex-cotton) amid a 18% price hike, power outages and water availability concerns led to lower application during the season.
Among major fertilizer players, FFBL and Engro faced a 42% and 38% decline in urea off-take in the period under review respectively, while cheaper imported urea accounted for 27% of the total market.
With Rabi season of 2013 crop cultivation in full swing, analysts expect off-take, particularly of DAP, resulting in better profitability for DAP players.
Published in The Express Tribune, November 1st, 2012.