Pakistan’s 150,000 tons urea tender attracted global attention

Pakistan pays special care to ensure the availability of fertilizer to meet food security requirements. The county imported 1.37 million metric tonnes of fertilizer worth $685mn between July 2023 and June 2024, compared to $604mn in the previous fiscal year. This 52% increase in quantity and a 13.28% rise in value over the twelve months is significant, indicating a growing demand for fertilizers in Pakistan’s agricultural sector. However, the appetite has yet to be fully met, and Pakistan continued to tap into the world market to secure additional supplies to meet the requirements in September and beyond.

Pakistan received significant interest from leading fertilizer suppliers in the latest bidding round. Russia, Azerbaijan, Turkmenistan, the Middle East, the Far East, China, Malaysia, and Indonesia showed keen interest in supplying over 625,000 metric tonnes of urea to Pakistan during Kharif 2024. This interest bodes well for Islamabad’s urea demand in the ongoing season and upcoming Rabi, reassuring stakeholders in the fertilizer supply chain about the availability of urea.

According to the bidding result obtained by Fertilizer Daily, these interests were intended suppliers against Trading Corporation of Pakistan (Pvt.) Ltd. (TCP), Karachi tender opened on 29 July. TCP is a state-owned commercial organization working under the administrative control of the Ministry of Commerce, Government of Pakistan, responsible for procuring urea from international suppliers/producers. The bidding was for the supply of 150,000 (One Hundred & Fifty Thousand) metric tons (MT) of urea, with the capacity to supply ‘Urea’ (in bulk) through worldwide sources on a CFR Karachi / Gwadar basis (in bulk shipment).

The bidding process was competitive, with six companies participating in the tender. These companies, including West Trade, Mercury DMC, ABG Trading, SINEPO, Singapore, Torbert DMC, and Trammo GmbH, brought a variety of offers to the table. The price per ton of urea varied among bidders, with West Trade offering the lowest price at $358.99 per ton. Bidders also offered varying quantities of urea, ranging from 45,000 to 150,000 metric tons, making the bidding process informative and competitive.

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According to the government of Pakistan Ministry of National Food Security and Research National Fertilizer Development Centre (NFDC), the total availability of urea is estimated at 3.378 million metric tonnes, with domestic production of 3.204 million metric tonnes and 174,000 metric tonnes of carryover stock. The closing balance of around 261,000 metric tonnes is significant, indicating the potential for stable or even lower urea prices shortly. Urea offtake estimates for Kharif 2024 are 3.1 million metric tonnes, with the expected imports of 150,000 metric tonnes of urea in September 2024 set to improve its availability during Rabi 2024-25.