Karachi, April's fertilizer off-take is projected to fall significantly both month-over-month and year-over-year, as per recent industry forecasts. Urea sales are expected to reach approximately 327,000 tons, marking declines of 51% from the previous month and 20% from the previous year. This downturn is largely attributed to decreased sales at Engro Fertilizers Ltd, which is experiencing operational downtime due to maintenance at its Enven plant.

According to JS Global, Engro Fertilizers Ltd is anticipated to see a drastic reduction in urea sales, expected to drop by 65% month-over-month and 52% year-over-year. In contrast, Fauji Fertilizer Company is predicted to report urea sales of 187,000 tons, which represents a 40% increase year-over-year but a 36% decrease from the previous month, reflecting significant pre-buying activities in earlier months. The overall market is expected to confront elevated inventory levels by the end of April, potentially exceeding 250,000 tons.

Di-Ammonium Phosphate (DAP) sales are also expected to decline month-over-month in April. The forecast suggests a figure around 95,000 tons, which is an 88% increase year-over-year but an 11% decrease from the previous month. Notably, Fauji Fertilizer Bin Qasim Limited, the sole manufacturer of DAP, is projected to account for an off-take of 52,000 tons for the month, contributing to a four-month cumulative total of 221,000 tons.

The report also highlights a narrowing price gap between domestic and international urea markets. Domestic urea now averages a 13% discount to imported prices, down from historical wider margins. This shift comes as international urea prices continue to decline, and domestic producers face increased gas prices, a measure supported by IMF directives to address circular debt issues in Pakistan. Current landed prices for imported urea are around Rs5,200 per bag, compared to local tag prices ranging from Rs4,400 to Rs4,600 per bag.