Shortage of urea Cotton, rice production targets may be missed

Pakistan may miss the production targets of cotton and rice in 2011-12 as the first consignment of urea would not reach Pakistan by the end of July, reducing productivity of Kharif crops by 15-20 percent. The government has set GDP growth target for 2011-12 at 4.2 percent with contribution of agriculture sectors of 3.4 percent, with major crops accounting for 3 percent, minor crops 2 percent, livestock 4 percent, fishery 2 percent and forestry -1 percent.
Sources told Business Recorder that the Trading Corporation of Pakistan (TCP) has made certain arrangements to import urea from the international market to bridge the shortage of the commodity in the domestic market. TCP has been tasked to import 50,000 tons of urea because the commodity''s import under Saudi Arabia Basic Industry Corporation (SABIC) has been delayed.
"Cotton and rice are the major crops that would be affected as a consequence. This, in turn, will have a severe impact on overall GDP of the country. Thus, non-availability of urea at this critical period of time when the major crops, especially cotton, needs fertiliser, can reduce the crop''s overall productivity by 15-20 percent and thereby reduce the overall GDP growth in the next fiscal year", sources said.
"Two-three bags of urea are used per acre of land. If the quantity of the fertilizer used is reduced by just 10 percent, the overall productivity per acre would be reduced by about 4-5 percent", they added.
The requirement of urea is 6.4 million tons against its 6.7 million tons production capacity but short supply of gas to the fertilizer manufacturing plants has resulted in lower output of urea compelling the government to import the commodity.
The fertilizer-manufacturing companies have been provided 80 percent of their gas requirements since January 2011. One urea manufacturing plant of Engro stopped operation owing to the gas shortage.
Sources said that the government is providing gas to the manufacturing plants at discounted rates that accounts for Rs 320 per urea bag less than it would have been otherwise priced.
Ibrahim Mughal, Chairmam of Agriforum, told Business Recorder, "The farmers don''t want any subsidy to be extended to the fertiliser-manufacturing companies because the effect of this subsidy is not passed on to the farmers and the middle man gets the entire benefit". He added that the price should be explicitly printed on each bag.
He said, "Research and Development (R&D) in Pakistan needs special attention. It is really pathetic that Pakistan has not developed its seeds used in the production of major crops. Every year, millions of rupees are spent by the governmental agricultural departments to import seeds. In Pakistan, these imported seeds are sold at 3 times their imported price."