Govt seeks explanation from Engro on urea price hike | Pakistan Today

Govt seeks explanation from Engro on urea price hike

ISLAMABAD – Taking strict notice of a massive price hike of Rs 190 per bag of urea by the largest urea manufacturer in the country, Engro Fertilisers, the government has sought an explanation from the manufacturer. A spokesman of the ministry of industries said that under directives of the minister for Industries Mir Hazar Khan Bijarani, the ministry has taken a serious notice of a unilateral increase in the urea price of Rs 190 per 50 kg bag by Engro Fertilisers Limited.
There is no justification in the increase in urea price as sufficient stocks of urea are available in the country. This increase is indeed alarming. The manufacturer has been asked to explain this increase immediately to the fertiliser price review committee, he said.
It is pertinent to mention that the fertiliser manufacturers had made a commitment with the ministry of industries that they would print the retail price on their produced urea bags. But manufacturers and dealers have not complied with the decision. Spokesman said this is a clear-cut violation of the decision and rules and regulations of the Competition Commission of Pakistan.
The government is fully aware of the domestic need to make urea available and affordable to growers, he said adding that the government had already provided free of cost imported urea to all flood affected farmers.
At present 100,000 tonnes of urea is also available with the National Fertiliser Corporation for the rabi crops and another 225,000 tonnes of urea is being imported under Saudi Basic Industries Corporation (SABIC) facility.
The imported commodity is expected to arrive in January, to curtail the shortfall in domestic production. The local urea production has recorded a decline due to a 20 percent reduction in natural gas supplies to local manufacturers since May this year and due to extended winter gas load shedding for 45 days. Only the Fauji Fertiliser Company has managed to escape gas load shedding as it receives it feed stock gas from low BTU Marri gasfield. With the recent hike in prices the domestic urea prices would increase to Rs 1100 per bag as compared to imported urea price of Rs 2000 per bag. With the commission of 0.5 million tonnes of Fatima Fertilisers and 1.3 million tonnes of new Engro plant the country’s urea output will enhance to 6.7 million tonnes from 4.9 million tones against an annual demand of 6.4 million tonnes.

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