The price of Diammonium Phosphate, more commonly known as DAP fertilizer, has spiked to Rs. 13,000 per 50kg bag in Punjab as the rupee has fallen more than 7 percent against the dollar in a month.
Well-informed sources told ProPakistani that DAP is being sold at Rs. 13,000 per 50kg bag in Multan, Okara, Bahawalnagar, Mianwali, Bahawalpur, Layyah and Haroonabad and even for Rs. 13,300 down South in Rajanpur and surroundings.
However, in Upper Punjab areas like Sheikhupura and Jhang, it’s priced at around Rs. 12,800 per 50kg bag, which is also higher than notified prices.
Maximum Retail Prices notified for Fauji Fertilizers’ Sona DAP is Rs. 11,732 per 50kg bag and Rs. 11,721 for Sarsabz DAP.
It must be noted that it’s the same DAP that was being sold under invoice a few months ago due to lower demand and higher inventory costs. While the price rise was expected, big manufacturers have raised the MRPs and the gap between MRP and the on-ground prices is only widening because of unchecked hoarding.
“There are four factors behind this price hike. Foremost is the exchange rate as more than half of the DAP is imported. There is lower production in comparison to the previous year with 5 percent FED imposed by the government and now the hoarders have also entered the market anticipating further devaluation and high demand during the Rabi Season” said a market consultant while talking to ProPakistani.
DAP has 46 percent Phosphorus which is critical for plant root growth, winter hardiness, seed formation, and converting other materials into usable building blocks. It also has 18 percent Nitrogen which is one of the most critical nutrients due to its role in food formation. On the other hand, urea prices are also on the rise and are at Rs. 4,200 to 4,500 at the consumer level despite the fact the MRP is far lower.
It is feared that such a massive hike in prices will ultimately cause a decline in the production of key Rabi crops of wheat and potatoes, the former of which is critical for ensuring national food security and later brings dollar inflows through exports.
Fertilizer is not the only input whose price is rising as diesel and electricity price hikes will also have an impact on farming communities.
Source: ProPakistani