Karachi, September 27, 2023 – The government’s aggressive measures against urea hoarding and smuggling have led to a substantial reduction in fertilizer prices, providing much-needed relief to farmers across Pakistan.
The recent crackdown, initiated by Interim Interior Minister Sarfaraz Bugti, has started to yield positive outcomes, with market prices for urea dropping by approximately Rs 500 to 600 per bag.
Last week, the government intensified its actions against individuals involved in the illegal hoarding and smuggling of essential commodities, including wheat, sugar, urea, and oil. According to an interior ministry report, more than 90 middlemen were implicated in these activities, which artificially created shortages and inflated fertilizer prices.
Media reports on recent raids reveal that approximately 90,000 bags of fertilizers have been seized from various parts of Sindh, with an additional 85,000 bags recovered from various warehouses in Mirpurkhas.
The illegal hoarding and smuggling activities had led to urea prices soaring to as high as Rs 4,200 per bag in various regions of the country, in contrast to the official retail price range of Rs 3,100 to 3,400 per bag. These price hikes occurred despite the government’s concerted efforts to ensure uninterrupted gas supplies to all fertilizer plants, enabling them to operate at full capacity to meet the annual urea demand estimated at 6.8 million tons.
Brig Sher Shah, Executive Director of the Fertilizer Manufacturers of Pakistan Advisory Council (FMPAC), commended the swift and decisive actions taken by government authorities against those engaged in hoarding and smuggling. He emphasized that the local fertilizer industry has always striven to ensure a consistent and affordable supply of urea to farmers.
Sher Shah also pointed out that some unscrupulous actors in the market were profiteering by selling urea at prices significantly higher than the official rates, potentially costing farmers an additional Rs 100 billion on fertilizer purchases in 2023.
Furthermore, he praised the efforts of Dr. Ijaz Gohar, the caretaker Federal Minister for Commerce, Industries, and Production, in ensuring uninterrupted gas supplies to the fertilizer sector. Sher Shah noted that consistent gas availability would help maintain sufficient fertilizer stocks for the upcoming Rabi season, contributing to a higher yield of wheat, which is vital for Pakistan’s food security.
The recent crackdown against hoarding, combined with increased production, offers a promising outlook for both farmers and the agricultural sector, as Pakistan works towards bolstering its agricultural productivity and ensuring stable food supplies.
