Fauji Fertilizer Company (FFC) has increased the price of granular urea by Rs. 125 per bag, pushing the maximum retail price of FFBL-branded granular urea to Rs. 4,749 per bag, according to a report by Topline Securities.
The latest adjustment comes at a time when Pakistan’s fertilizer industry is witnessing stable demand but rising inventory levels, reflecting shifting buying patterns among dealers and farmers during the ongoing agricultural cycle.
Market data also shows that the price of prilled urea remains at Rs. 4,525 per bag, maintaining a gap between different product categories within the nitrogen fertilizer segment.
Seasonal Demand and Sales Trends in Urea Market
Industry estimates indicate that urea sales in Pakistan reached approximately 419,000 tons in May 2026. This figure remains largely unchanged compared to the same month last year but reflects a 10 percent decline compared to April 2026.
Analysts attribute the monthly slowdown to the completion of early Kharif season purchasing activity. Dealers are now focusing on clearing accumulated stocks after strong buying momentum earlier in April.
Despite short-term fluctuations, cumulative urea sales during the first five months of 2026 are estimated at 1.9 million tons, showing an 8 percent year-on-year increase. This suggests that underlying agricultural demand remains relatively stable, supported by continued cropping requirements across major farming regions.
Rising Inventories Across Fertilizer Companies
Higher prices and liquidity constraints among farmers have contributed to delayed purchasing behavior in several areas. As a result, industry-wide urea inventories are estimated to have increased to 0.99 million tons in May 2026, up from 0.83 million tons in the previous month.
Company-wise inventory estimates show that Engro Fertilizers holds the largest stockpile at approximately 637,000 tons. It is followed by Fatima Group with 221,000 tons, while Fauji Fertilizer Company maintains around 113,000 tons.
These inventory trends highlight a temporary imbalance between supply and retail absorption, particularly after strong pre-season demand in April.
Sales Performance Across Major Producers
Despite price adjustments, FFC’s urea sales are projected to increase by 24 percent year-on-year to around 257,000 tons in May. Meanwhile, Fatima Group is expected to report a sharp rise in sales to approximately 87,000 tons.
In contrast, Engro Fertilizers is estimated to have experienced a decline in monthly sales, reflecting shifting market share dynamics during the reporting period.
Weakness in DAP Demand Signals Cost Pressure for Farmers
Alongside urea market fluctuations, Pakistan’s fertilizer sector is also witnessing a notable slowdown in DAP (diammonium phosphate) demand.
Industry estimates indicate that DAP sales fell by 42 percent year-on-year and 34 percent month-on-month, dropping to around 55,000 tons in May 2026. The decline is largely attributed to persistently high prices, which remain above Rs. 15,000 per bag.
However, cumulative DAP sales for the first five months of 2026 are still projected to be 30 percent higher than the same period last year, indicating that long-term demand remains intact despite short-term affordability challenges.
Outlook for Pakistan Fertilizer Sector
The fertilizer market in Pakistan continues to balance between strong agricultural demand and cost-driven purchasing delays. While urea consumption trends remain relatively stable, rising inventories and fluctuating prices suggest a cautious outlook for the coming months, particularly if input costs remain elevated for farmers across key cropping cycles.
