KARACHI: The country’s urea demand grew by nine per cent in 8MCY21 to 4.169 million tonnes from 3.814m tonnes in the same period last calendar year, while August production posted a growth of 13pc to 649,000 tonnes from 573,000 tonnes in August 2020.

The above improvement in urea sales signals better farm economics and seasonality factor as Rabi sowing is approaching, Research analyst at BMA Capital Noor Huda Shaikh said.

DAP off-take declined by 37pc to 187,000 tonnes in August from 295,000 tonnes in August 2020 while it fell by 14pc to 981,000 tonnes in 8MCY21 from 1.141m tonnes in same period 2020 due to pre-buying by the dealers in anticipation of rising prices.

He said international DAP prices are trending at high levels with recent trade orders concluding at over $860 per tonne. The Fauji group recently raised local DAP prices by Rs140 per bag, taking current market price to new highs of Rs6,500 per bag.

Mr Huda expected limited exports from China and higher import demand in India and Pakistan due to seasonality to support international DAP prices in the near-term. However, prices are expected to revert to their normal levels afterwards.

Urea inventory dropped to 187,000 tonnes in August from 308,000 tonnes in August 2020, down by 39pc mainly due to closure of RLNG-based plants, which resumed production recently in late September.

Published in Dawn, September 25th, 2021