Karachi, March 15, 2024 – In a concerted effort to align with the government’s directives and ensure fair pricing and availability of urea, Engro Fertilizers has initiated dialogues with its dealers, urging them to adhere strictly to company guidelines.
To reinforce the commitment towards maintaining urea prices at the official Maximum Retail Price (MRP), Engro Fertilizers convened dealer conferences in key locations including Lahore, Multan, and Hyderabad. Speaking at these conferences, Engro Fertilizers’ Vice President of Marketing, Atif Muhammad Ali, emphasized the company’s unwavering dedication to integrity. He stressed the importance of dealers’ cooperation in guaranteeing urea availability at government-mandated prices. Additionally, Ali clarified that Engro Fertilizers has refrained from raising the selling price of imported urea, aligning with the company’s support for governmental efforts to assist farmers.
The conferences also served as a platform to address recent developments in the fertilizer industry, notably the surge in gas prices. With feedstock gas prices for fertilizer manufacturers operating on SNGPL and SSGC networks skyrocketing from PKR 580/mmbtu to PKR 1,597/mmbtu, there has emerged a disparity in gas prices among different players in the industry. While some manufacturers, constituting 60% of the total capacity, face heightened gas costs, others operating on the Mari network, comprising 40% of total capacity, continue to benefit from subsidized gas prices at PKR 580/mmbtu.
This discrepancy in gas tariffs has led to market distortions, resulting in varying urea prices across the industry. Middlemen have capitalized on this situation, reaping excessive profits estimated at PKR 80 – 100 billion.
Expressing concern over this disparity, Mr. Ghulam Ahmed, Patron in Chief of the All Pakistan Fertilizer Dealer Association, emphasized the necessity of establishing uniform gas prices for all fertilizer manufacturers. This, he argued, would help standardize urea prices, eliminate market speculations, and ensure fairness in the industry.
By equalizing gas prices across the board, the government stands to not only stabilize urea prices for farmers but also generate substantial revenue, estimated at PKR 80 – 100 billion, which would otherwise be pocketed by middlemen. These funds could be redirected by provincial governments towards issuing direct subsidies on fertilizers or investing in initiatives aimed at enhancing agricultural productivity through modern farming practices.
Engro Fertilizers’ proactive engagement with its dealers underscores its commitment to ethical business practices and its dedication to supporting the agricultural sector’s sustainable growth. As discussions continue, stakeholders remain hopeful for positive outcomes that will benefit farmers and foster a more equitable fertilizer market.
