ISLAMABAD: Pakistan’s urea sales are projected to drop significantly to 365,000 tons, a 35% decrease compared to 564,000 tons in September 2023. This decline is primarily due to increased urea prices and weakening farmer economics. Seasonal factors also contribute to a similar 35% decline compared to the previous month, August 2024.
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For the first nine months of 2024, urea sales are expected to total 4.6 million tons, an 8% decrease from the 5.0 million tons sold during the same period in 2023. This decrease in sales is likely to push the closing inventory of urea to around 635,000 tons by the end of September 2024, up from 406,000 tons in August. Such inventory levels are anticipated to be the highest in the past 45 months.
Looking at individual companies, Engro Fertilizers (EFERT) is anticipated to see a significant year-on-year decrease of 71%, recording just 56,000 tons in September 2024. EFERT’s sales have been particularly impacted by higher urea prices relative to its competitors. Fauji Fertilizer Company (FFC) is expected to sell 199,000 tons, a 13% decline year-on-year, while FATIMA’s sales are projected at 69,000 tons, down 20%. Conversely, Fauji Fertilizer Bin Qasim (FFBL) is expected to increase its sales by 52% to 32,000 tons.
In contrast to urea, DAP (diammonium phosphate) sales in September 2024 are anticipated to rise by 35% year-on-year and 61% month-on-month, reaching around 143,000 tons. However, total DAP sales for the first nine months of 2024 are expected to be 940,000 tons, a 6% year-on-year decrease. For company-specific sales, FFBL is likely to lead with 79,000 tons, followed by EFERT with 15,000 tons and FFC with 7,000 tons in September 2024.
The closing inventory of DAP is projected to rise significantly to 365,000 tons by the end of September 2024, compared to just 29,000 tons in September 2023 and 232,000 tons in August 2024. This marks the highest inventory level in the past 20 months. These shifts in both urea and DAP sales and inventories reflect broader economic challenges and shifting agricultural dynamics in Pakistan.
