Pakistan’s Fertilizer Supply Remains Stable Amidst Global Risks

Islamabad – Despite escalating tensions in the Middle East and the potential for disruptions to global energy and agrifood systems, Pakistan’s fertilizer sector demonstrates a stable supply-demand alignment, according to a recent report from the Ministry of National Food Security, and Research. The country anticipates no shortages for the current Rabi and forthcoming Kharif crops.

Current Fertilizer Status

The Ministry’s situation report indicates that Pakistan’s fertilizer production currently meets 90 to 95 percent of total urea demand, with imports covering the remaining gap. Fertilizer consumption is growing at an annual rate of 2 to 5 percent, reflecting increased agricultural productivity. Stock buffers range from 5 to 10 percent of seasonal demand, ensuring sufficient supply for both Rabi 2025-26 and Kharif 2026.

Urea and DAP Availability

During the current Rabi season, urea availability exceeded 3.5 million tons against a demand of approximately 3.3 million tons, creating a surplus of 150,000 to 200,000 tons. Diammonium phosphate (DAP) availability also remains strong, exceeding 700,000 tons compared to a demand of around 650,000 tons.

For Kharif 2026, projected urea availability is estimated at 3 to 3.2 million tons, against an expected demand of 2.9 to 3 million tons. DAP availability is projected at 750,000 to 800,000 tons, exceeding the anticipated demand of about 700,000 tons.

Price Stability

Domestic urea prices remain stable, ranging from Rs3,700 to Rs4,000 per 50kg bag, significantly lower than international prices which exceed Rs5,500 to Rs6,000 per bag. Similarly, domestic DAP prices range between Rs11,500 to Rs12,500 per bag, while international prices are above Rs14,000.

Production Capacity and Key Players

Pakistan’s annual urea production capacity stands at approximately 7 million tons. Major producers include:

• Fauji Fertiliser Company (capacity over 2.5 million tons)
• Engro Fertilisers (capacity around 2.3 million tons)
• Fatima Fertiliser (capacity 700,000–800,000 tons)
• Fauji Fertiliser Bin Qasim (DAP capacity around 650,000 tons)

Gas Supply Critical for Production

The fertilizer sector consumes approximately 700–800 million cubic feet per day (mmcfd) of natural gas. Around 60 to 65 percent of production relies on gas supplied by Sui Northern Gas Pakistan Limited (SNGPL), with the remainder utilizing dedicated or diverted gas sources. The report notes that even with temporary shutdowns of one or two plants, production remains above 85 to 90 percent of national demand.

Growth Trends

Urea consumption has grown from approximately 6.0 million tons to nearly 6.8 to 7.0 million tons over the last five years, representing a compound annual growth rate (CAGR) of around 2 to 3 percent. DAP consumption has increased from about 1.1 million tons to nearly 1.4 million tons, indicating a CAGR of 4 to 5 percent. Annual urea demand ranges between 6.5 and 7 million tons, while DAP demand fluctuates between 1.2 and 1.5 million tons.

Seasonal Demand Patterns

Urea consumption peaks during Rabi, accounting for 55 to 60 percent of total annual usage due to wheat requirements. Kharif season sees increased DAP demand, representing approximately 60 percent of its annual consumption.

Cropping Patterns

Pakistan cultivates approximately 22–23 million hectares annually across two major seasons. Wheat occupies around 9 million hectares during Rabi, while gram and oilseeds cover another 2 to 3 million hectares. In Kharif, rice is grown on roughly 3 million hectares, cotton on 2 to 2.5 million hectares, and sugarcane on over 1.2 million hectares.