Based on the National Fertilizer Development Center ‘s latest sales results, the urea market appears to be under considerable pressure with an accumulation of 850,000 tons of inventory due to a slowdown in the agricultural sector of the country.
The fertilizer industry had begun the year with an opening inventory of 600,000 tons, but on the back of the manufacturers’ highest-ever quarterly production of 1,42 million tons and decreasing sales volume, the inventory continued to grow. If the same trend persists, the inventory of urea will grow by the year-end to an estimated 1 million tons.
Compared to last year’s same era, April’s urea sales reported a decline of 18 percent to 240,000 tonnes. At the same time, sales dropped by 12 percent compared to 303,000 tonnes last month. This declining off-take trend, which is projected to continue for the rest of the year as well, points to supply chain disturbances in the agricultural sector and a general economic downturn with real GDP growth possibly contracting by 1.3 percent.
According to Abdul Razak Dawood, advisor to the Prime Minister for Trade, Textile, and Investment, Pakistan’s exports are projected to decline by about $3 billion over the current fiscal year following the COVID-19 pandemic.
Extracted from City42 News