ISLAMABAD: FFBL reviewed the article and would like to state factual position concerning FFBL’s efficiency, as mentioned in the article. FFBL is the Sole Producer of DAP and Granular Urea in the country. By any given standards:
domestic or international, FFBL’s Urea and DAP operations are at par with or superior to all its competitors and therefore the question of inefficiency doesn’t arise. Moreover, 2022 has been an extraordinary year: Commodity Super Cycle, Russo-Ukraine War, prevalent instable political/financial conditions and unprecedented floods, that have left most businesses in Pakistan, struggling.
According to Business Recorder due to FFBL’s ‘inefficiency,’ inland DAP was costlier as compared to imported DAP.
In 2022, FFBL accrued massive losses to the tune of PKR 7bn in PKR vs USD parity, PKR 4.1bn in additional GST costs imposed in Finance Bill 2022, PKR 2.8bn in Super Tax imposed by GoP retrospectively, PKR 1.5bn in incremental GST on Granular Urea for power/steam and PKR 5.1 bn in finance cost. This adds upto a whopping PKR 20.5 bn. Add to it the fact that importers look for an opportune time to import DAP, when it is cheap internationally, whereas FFBL produces at a cyclic rate and therefore produces DAP round the year, at varying raw material costs.
It is in fact FFBL which ensures ‘Assured DAP availability,’ round the year and shields farmers’ fraternity from vagaries of international market. Normally FFBL comprises 34-42% of domestic DAP market, however in 2022, FFBL’s market share jumped to 57%, because of market conditions explained above.
Copyright Business Recorder, 2023
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