Fertilizer sector invested $2.3 billion in 4 years

LAHORE: Fertilizer sector has invested $2.3 billion in last 4 years making Pakistan self-sufficient in urea production and earned huge profit despite gas supply suspension for a long time.

Industry circles said that with consistent gas supply to urea plants, the new government of the PML-N can ensure timely availability of this key farm input to farmers at the cost effective rates.

It is to be noted that the fertilizer industry has remained the best performer at the capital market, as it has surpassed all sectors in terms of paying ‘return on equity’ to its shareholders.

Industry circles were of the view that by not producing urea locally, country has to import urea which is the most expensive form of energy on MMBTU basis, costing around $23/MMBTU, whereas RFO and LNG would be 30-50pc less expensive than urea on a MMBTU basis.

They said that Pakistan cannot afford to spend hundreds of millions of dollars on urea import and they are hopeful that PML-N government would ensure judicious distribution of gas amongst all the sectors of economy.

They said that all other industries have alternative fuel options except fertilizer sector that uses gas as raw material to produce the key farm input urea for the farmers that ensure food security of the masses as well as provide raw material to important industries like textile and food processing. SNGPL based four plants faced more than 300 days of gas curtailment in year 2012. If gas is discontinued to fertilizer plants in 2013, Pakistan would have to import 1 million tons of urea which can cost national exchequer $450 million dollars and a subsidy of Rs21 billion to match the imported urea price to domestic urea prices. They said that Fertilizer sector is not burning the gas to run the plants, it offers maximum value addition by converting the raw gas into precious urea grains and country hugely benefits from the fertilizer industry.

Meanwhile, Fertiliser Manufacturers Pakistan Advisory Council (FMPAC) has congratulated PMLN and its leadership Mian Muhammad Nawaz Sharif and Mian Muhammad Shahbaz Sharif for securing the majority in election and hoped that PML-N Government would revive the agriculture economy of the country to ensure farmers’ well being and food security of 190 million countrymen.

Pakistan despite being an agriculture economy, agriculture sector remained the worst hit and most neglected area of economy in last few years. With the PML-N government in the power, we are confident that Mian Nawaz Sharif would ensure early revival of the agriculture sector through better and long-term policies.

He said that PML-N leadership fully understands the importance of agriculture sector for the quick revival of the economy and fertilizer sector being an integral part of agriculture economy would be given due importance while allocating the precious gas resources.