LAHORE: The new year has begun with bad news for the farming community as prices of the Urea fertiliser, which is in high demand for wheat crop these days, have been increased by around eight per cent.

A notice issued by the Engro Fertilizers Limited says that its brand of Urea compost will be marketed at a rate of Rs2,440 per 50kg bag from Jan 1, 2023, an increase of Rs190 per bag.

A spokesperson for the company claims that the increase was forced because of rising production costs.

The installed capacity of the urea fertiliser manufacturing in the country is 6.5 million tonnes against the total national demand of 6 million tonnes for the whole year.

Despite this surplus production, the country faces shortage of the fertiliser during its peak off-take season and the farmers have to purchase it at a ‘premium’ ranging between Rs700 and Rs1,000 from the black market.

As most farmers could not afford to pay such a high cost of the compost, its consumption drops affecting per acre yield of the crops.

Last year, the country faced a shortfall of 1.5 million tonnes in wheat production and this shortfall had to be met by importing grain from abroad at a much higher cost.

Ironically, the government had fixed the Urea price with a consensus of the industry at Rs1,950 per bag last year.

The manufacturers had committed that the commodity would be available to the farmers across the country but after two weeks, they unilaterally enhanced the compost price by Rs400 per bag.

Neither the ministry concerned nor the federal government took notice of the exploitation as the fertiliser industry took the plea that the increase was necessitated because the government did not timely pay the promised subsidies to it.

Since Nov 16, 2022, Engro is selling its DAP (di-ammonium phosphate) brand at Rs10,442 per 50kg and NP (nitrogen phosphate) fertiliser at Rs7,063 per 50kg.

Published in Dawn, January 2nd, 2023