Providing Agricultural Services

Tanveer Brothers Zafarwal, Punjab, Pakistan.
Mon-Sat: 09:00 AM - 07:00 PM
30 Jan 2025

Beyond farming: Non-agricultural forces shaping Pakistan’s economic future

In Pakistan, there are numerous discussions and research conducted regarding agriculture.
People continuously talk and write about agriculture, especially regarding the import , production and distribution of fertilizers, their usage, and demand and supply issues in Pakistan. For the past
three years, there has been a persistent concern that the fertilizer distribution system in Pakistan has deteriorated and requires significant reforms. It’s a situation where the fertilizer, meant for
distribution, is either being hoarded or not reaching its intended recipients. We have raised this issue with various government departments and forums, highlighting the mismanagement in
fertilizer distribution, which is causing immense distress and losses to our agriculture and farmers. Unfortunately, despite the severity of the situation, there hasn’t been much attention
or action from the government. Moreover, with the unfortunate end of one government term and the incoming of another, the issue seems to have been left unaddressed, with no concrete
steps towards its resolution. In the past 10 years the cultivation of hybrid crops has increased significantly in Pakistan, especially in relation to rice and maize. In all the central regions of
Punjab, hybrid rice cultivation has been rapidly increasing. Similarly, it is also gaining momentum in Sindh, and maize cultivation is particularly prominent in Pakistan’s Sahiwal divisions, where
hybrid varieties are extensively grown. As we all know, farmers in hybrid crops typically use double doses of urea. Additionally, the traditional non-agricultural land in Pakistan, which was
previously fallow, has been converted into cultivated areas, and agricultural activity is now underway there.
Furthermore, especially in the last four years, farmers have been pleasantly surprised as they have received better rates for their crops, and worldwide, the prices of grains have improved.
This phenomenon has also been observed in Pakistan, where farmers have actively participated in agriculture and utilized all available resources to ensure the best quality of their crops. With
diligence, they have enhanced their economic condition. Unfortunately, instead of boosting the morale of the farmers in this situation, we insisted on sticking to the outdated system. We neither imported timely fertilizers nor did we maintain the existing plants within the country.
Consequently, farmers faced tremendous difficulties in obtaining urea fertilizers, which hindered
their cultivation activities. Our entire point is that due to hybrid crops and farmers’ participation in aggressive agricultural activities, the demand for urea has increased. According to government claims, urea sales remained at 6.5 million tons in 2023, but according to our estimates, this figure
is incorrect because the existing stock of urea was already at 6.5 million tons. According to our estimates, the minimum capacity should have been 6.8 million tons, and ideally, to ensure timely
availability and continuous support to farmers, there should have been at least a 0.7 million ton buffer stock. We believe that for the improvement of agriculture in Pakistan, timely and
continuous availability of urea is crucial Another challenge that will be a significant concern for the new government is the fluctuation in
urea prices over the past three years. This has also contributed to the deterioration of the fertilizer distribution system and its infrastructure. Currently, similar to urea, there is a single type
of fertilizer in the market with at least six different prices, which creates confusion for farmers and puts pressure on their pockets. We firmly believe that as long as urea prices remain
inconsistent, it will continue to pose challenges for farmers. It is imperative for the new government to address this issue immediately and implement all necessary measures to stabilize
urea prices, as it is essential for ensuring food security not only for Pakistan but also for the regional countries. This can be achieved by immediately unifying urea prices and ensuring its availability well in advance, so that Pakistan not only resolves its food security issues but also becomes a food basket for regional countries.

Ghulam Ahmad Pattern -in -Chief APFDA

Published on Mar 7, 2024

30 Jan 2025

Uniform gas rates: appreciable govt decision

All Pakistan Fertilizer Dealers Association appreciates the Cabinet’s decision to uniform the gas price on urea fertilizer plants It believes that the unified price for gas on urea fertilizer plants will improve the efficiency of urea production and availability of urea in Pakistan. Previously, due to varying rates of urea, farmers had to purchase urea at higher prices, causing inconvenience. With a single price for urea, farmers will find it easier. Therefore, the All Pakistan Fertilizer Dealer Association not only welcomes this decision but also suggests its effective implementation in phases to avoid sudden price hikes. Additionally, it requests that where gas prices affect urea prices, dealer margins should also be increased accordingly. Furthermore, to improve urea availability, urea plants should operate throughout the year, and gas supply should remain consistent.The rationalisation in urea prices within Pakistan will also lead to a decrease the misuse of urea fertilizer Similarly, there will be a move towards balanced usage of other fertilizers in Pakistan, which is crucial. According to the All Pakistan Fertilizer Dealer Association, the balanced distribution of urea is more important than its prices. The association consistently advocates for and promotes initiatives that benefit the country’s agriculture and economy. According to our understanding, once urea prices stabilize, the usage of other fertilizers such as phosphate and potash will increase, resulting in improved agricultural productivity and better food quality. This will enhance our agricultural exports as well. However, due to the misuse of urea, the subsidy on urea is not proving beneficial, and the quality of our crops is not improving. Therefore, it is imperative to promote the balanced use of fertilizers within the country at this time. Regulatory authorities should focus on their responsibilities rather than solely monitoring urea usage. Thank you

Ghulam Ahmad

Published on Newsman Feb 19, 2024

30 Jan 2025

Fertilizer dealers, The rescue boat for all stakeholders

Ghulam Ahmad Pattern in chief APFDA
In Pakistan, agriculture plays a vital role at different times. The use of fertilizers is crucial for increasing
crop yields. Therefore, the transportation and production of fertilizers in Pakistan are of great importance.
Monitoring fertilizer prices is not only a political issue for every government but also plays a significant
role in food security. Every government in Pakistan prioritizes efficient management of fertilizer
transportation, import, and production. This ensures the availability of fertilizers at the lowest possible
prices. The goal is to empower farmers, enabling them to use fertilizers for enhanced crop production.
This not only serves as a political advantage for the government but also plays a crucial role in improving the overall economic conditions by boosting agriculture.

Pakistan extensively uses fertilizers, with significant quantities of urea, DAP (Di-Ammonium Phosphate),
Nitro Phosphate, and calcium ammonium Nitrate being employed. Effective management of fertilizer
production, import, transportation, and timely delivery to farmers is crucial. Unfortunately, challenges
like mismanagement, policy fluctuations, and insufficient sensitivity to market dynamics often lead to
shortages. Sensible policies and adept micro-management are essential to overcome these hurdles and
ensure a steady supply of fertilizers at the grassroots level. This should remain a top priority for every
government in Pakistan.

The management of urea in Pakistan faces challenges due to gas shortages, affecting plants like the Sui
Southern Gas Company (SSGC) and SNGPL, when these gas-dependent plants don’t receive gas, they shut down and the areas across the country suffer from a lack of urea. This imbalance leads to a shortage, prompting the need for imports. Failure to timely import creates panic in the market , impacting Pakistan’s economy. The urea crisis has persisted with intensity over the past three years. Despite continuous alerts from the All Pakistan Fertilizer Dealers Association about the increased use of urea fertilizer , and decrease in DAP, suggesting the need for timely importing urea to balance, no action was taken. When the shortage became apparent nationwide, blame was placed on dealers, hinting at hoarding, later it was revealed as smuggling. Despite efforts like introducing the Portal System by the government and adherence by all dealers, the responsibility for all the flaws was laid on the dealers. Even in 2022 and then in 2023, but the only solution was to run it planned, import it timely so that the All Pakistan Fertilizer Dealer Association always kept saying that its buffer stock should be taken to ten percent levels so that once and for all this issue could be resolved in Pakistan. But unfortunately, this was not done in 2022, and here we are in 2023, and the entire government machinery and all stakeholders connected to this field kept blaming dealers that dealers are behind all this, although we must understand that dealers are neither policy makers nor importers nor producers, but they are just the mediator and facilitator who lifts goods from the company’s point and sell to farmers. This desire is to earn a modest livelihood, but unfortunately, despite being such, the blame for all the flaws is still on the dealers. Apologies for the oversight but let me provide you with the English translation of what I said earlier.

The whole world stabilizes the prices of anything by fulfilling its demand, improving the supply but here,
we don’t seem to understand this concept. For three years, we’ve been trying to control prices without
fulfilling the demand, and we also want to make it formal. In all these actions, when the government
started taking action in 2021, there was only about a hundred to one hundred fifty rupees of over pricing in urea, but with continuous misfortune, for two continuous years, there were interventions, checkposts, and interference from both governmental and non-governmental people difference goes up from 400- 500 between main market and secondary markets. However, the solution was to immediately import it, and give it to farmers. The poor farmer is already giving more money than this entire mess, and if the same product was imported and kept according to the farmer’s needs, he would get it at least a thousand rupees cheaper so he will get subsidy/ extra benefit via surplus supply. Short supply has the problem to reach it’s destination’s so we still request that sensitivity should be understood be estimated according to the increasing demand. The urea demand has increased by more than seven million tons annually, so it should be arranged before time with 10% of buffer stock. The world operates on another principle that when there is a shortage or limited supply of something, the supplier dictates its terms and conditions to the buyers.

Unfortunately, over the past three years in our country, only one stakeholder, a dealer, has been held
responsible for all shortcomings and issues. However, we want to clarify that for the past three years,
dealers has become a rescue boat for all stakeholders. Now, maintaining this scapegoat role for him is
becoming difficult. We should respect the dealer and ensure that those who left the business after the
tumultuous action of the past three years are not only brought back but also provided with a platform for the ease of business for more people. This will create opportunities for Pakistani farmers, contribute to the growing needs and interventions, and play a role in Pakistan’s burgeoning agricultural sector.
Thank you.

Published in NEWSMAN, Jan 15, 2024

27 Jan 2025

Engro urges fair urea pricing

KARACHI: Engro Fertilizers has called on its dealers to strictly adhere to the official pricing guidelines to ensure urea availability for farmers, the company said on Friday.

During dealer conferences held in Lahore, Multan, and Hyderabad, Engro Fertilizers’ vice president marketing, Atif Muhammad Ali, emphasised the company’s commitment to integrity and its expectation for dealers to support farmers’ prosperity by maintaining urea prices at the government-mandated rates.

“Engro Fertilizers has always adhered to the highest standard of integrity and holds the same expectations from its dealers. To support the prosperity of farmers, Engro dealers must ensure urea availability at official prices. Further, Engro Fertilizers has not increased the selling price of imported urea to facilitate the government in providing support to farmers,” Ali said

At the conference, the dealers were also updated on the recent gas price hike and the disparity of gas prices that exists among different fertilizer players. Feedstock gas prices for fertilizer manufacturers on the SNGPL and SSGC network, which produce 60 percent of the total capacity, have increased from Rs580/mmbtu to Rs1,597/mmbtu. On the other hand, the remaining fertilizer manufacturers on the Mari network, which produce 40 percent of total capacity, are still on the subsidized price of Rs580/mmbtu.

As a result of this discriminatory gas tariff, price distortion has been created in the market with multiple urea prices existing in the market based on different gas input costs for the fertilizer manufacturers. This price distortion has provided the middleman with an opportunity to earn excessive profits of Rs80 – 100 billion.

Ghulam Ahmed, Patron in Chief of the All Pakistan Fertilizer Dealer Association, advocated for a uniform gas price for all fertilizer manufacturers to eliminate market speculation and normalize urea prices.

“It is in the country’s wider interest that a uniform gas price should be set for all fertilizer manufacturers. This will allow a single urea price to prevail, end market speculations and normalize the urea prices.”

By equalizing gas prices for all fertilizer manufacturers, the government can help stabilize urea prices for the farmers and earn Rs80 – 100 billion in revenues that would otherwise be pocketed by the middlemen. This can further be used by the provincial government to issue direct subsidies on fertilizer to farmers or develop modern farming practices to uplift overall agricultural productivity.

Published on thenews.com.pk (March 16, 2024)