LAHORE, Jan 20: Officially assessed urea shortfall plus disruption of gas supply because of recent developments in Sui gas fields are likely to undermine wheat production by causing shortage of fertilizers at a critical juncture for the crop now in the fields as also escalate the commodity's price just when it is most urgently needed.

While the government realized the problem in time, its implementation machinery acted with the public sector's usual lethargy with the result that imported supplies reached the country late and in insufficient quantity.

The question can be debated whether there was a genuine shortage of urea or a situation was created by vested interest groups, the statistics of supply and demand did not suggest a huge gap situation because the production was placed at 4.4 million tons and consumption at 4.7m tons.

A shortfall of just 0.3m tons could have been handled by efficient management because the entire quantity was not immediately to be applied. The government decided to import 250,000 tons through the Trading Corporation of Pakistan (TCP).

Shipments with 0.170 to 0.180m tons had reached the country by end December. Local production plus imported urea was enough for providing the required nourishment to the crop.

However, either mismanagement or gang up of exploitative groups succeeded in creating a shortage and hiking the price per bag of urea from official rate of Rs450 to Rs530-35 and even higher in remote areas.

"A further rise in the price is not to be ruled out because of supply position of gas which is raw material for urea. Farmers could be taken for a more expensive ride," says Ibrahim Mughal, Secretary General of Kissan Board.

He reminds that urea's per bag rate was Rs425 on June 10, this year when President Musharraf at a Kissan Convention promised price reduction. It has been officially raised by Rs25 per bag since then the market elements have added another Rs80-85 to the cost of a bag of urea.

He said that urea prices have escalated steeply since 1999 when they stood at Rs287 per bag, adding that this had happened despite the fact that there has been no significant raise in the cost of gas used by fertilizer factories and the government's policy of ensuring supply of gas to fertilizer factories on priority basis.

Two fertilizer factories - Fauji Fertilizer Company (FFC) and Dawood Hercules - are supplied gas from Sui fields. Of these, FFC counts for over 60 per cent of the total urea production in Pakistan.

Disruption of gas supply to them is certain to affect the availability of urea and give dealers another argument for selling the commodity at an even higher rate.

Agriculture experts assess that the impact of disruption of the supply of gas could result in loss of production of urea and that 'could make a dent in the size of the crop'. While they are reluctant to put quantity or percentage to possible loss of wheat produce, they are certain that it is likely to be 'considerable'.