Fertiliser industry to increase capacity to 7.5 million tons annually

The ongoing capacity expansion plans will increase the fertiliser industry capacity to 7.5 million tons per annum by the year 2010. According to an official estimate, the domestic demand for urea (which is 6.8 million tons per annum) is expected to grow at a CAGR of 5.25 percent in next five years.
At present, official sources said that the level of fertiliser consumption in Pakistan is one of the lowest among agrarian economies, coupled with the visible success of government efforts to encourage farmers to raise the fertiliser off-take; it will not be unrealistic to foresee an increasing demand for fertiliser going ahead.
The export potential, however, in the sector remains limited despite Pakistan's competitive advantage in urea production. Specifically, the capacity expansion programme in almost all the companies is expected to produce a supply glut in coming years. However, the prevailing excess supply in the international market may not allow domestic producers to export the surpluses.