Urea import alternatives: MoIP summary not considered by ECC

The Economic Co-ordination Committee (ECC) of the Cabinet didn't consider a summary moved by the Ministry of Industries and Production proposing different options as alternatives to urea import, well informed sources told Business Recorder. The government reportedly planned to import 0.225 million tons of urea from Saudi Arabia on deferred payment but was compelled to abandon the plan subsequent to the refusal of Saudi Arabia Basic Industries Corporation (SABIC).
This led to the submission of a summary by the Ministry of Industries to the ECC proposing alternatives with the request to approve one immediately to make available 0.225 million tons of urea in the local market for the Rabi season. However, the issue was not taken up in the ECC meeting on Thursday.
"Various alternatives have been proposed in the summary to increase production of urea domestically," an official stated. He added that alternatives were also discussed with the stakeholders during a meeting on January 4, 2011. It was proposed that in the first scenario gas loadshedding should be reduced from 45 days to 15 days to the fertiliser industry that would result in production of 250,000 million tons of urea and reduce the cost by Rs 48 per bag.
The winter gas loadshedding of 15 days, from 45 days to 30 days, from (Sui network) to industry will result in production of 150,000 tons of urea and would reduce the price per bag by Rs 48. The delay in winter gas load-shedding by one month will make available 250,000 tons of urea in the peak period while restoration of 60 mmcfd gas to Mari based plants for 30 days would produce 25,000 tons of urea and would reduce per bag price by Rs 38.
Sources said the Trading Corporation of Pakistan was not allowed to import urea, as the government decided to allow private sector to import urea. The fertiliser importers also reported to have refused to import the urea. Their demand was that price of local urea should be either brought at par with the price of the imported commodity or they should be provided subsidy of Rs 4.5 billion to enable them to sell 0.225 million tons of imported urea at the domestic price. This cost would be on account of actual differential between imported price and domestic sale price.