The fourth urea consignment of some 28,000 tons, imported by Trading Corporation of Pakistan (TCP) from Saudi Basic Industries Corporation (Sabic) under the credit facility, has reached Gwadar Port. In January this year, a commercial agreement was signed between TCP and Sabic for the supply of urea against $100 million credit facility being provided by the Saudi Fund for Development (SFD).
As per initial tentative schedule, Sabic committed to supplying some 115,000 tons of urea during first quarter (January-March) of 2013 and with arrival of the fourth shipment of urea, first quarter committed supply has been completed. First shipment of some 27,500 tons was arrived on February 12, 2013.
A ship MV PALAU carrying some 28,830 tons of urea has reached Gwadar Port on Friday. The ship was loaded and sailed from “Al-Jubail” port of Saudi Arabia” a few days back. Offloading of the commodity is likely to start today (Saturday), sources said. Overall, Sabic has supplied some 114,401 tons of urea through four shipments during the first quarter of CY13. Total delivery of the imported urea under $100 million credit facility is expected to be completed by end of December 2013.
Although, the country has a urea production capacity of over 6.5 million tons annually against a demand of 6 million tons, the local market is witnessing acute urea shortage for last two years due to low production followed by unavailability of gas. As per the agreement, Sabic will supply approximately over 200,000 to 240,000 tons of urea to Pakistan under $100 million credit facility provided by SFD. However, the quantity depends on the international price as if the prices will be on higher side that Pakistan will get less quantity or in case of lower prices, the country will have more supply from Sabic, sources said.
Talking about the price, sources said urea price will be determined as per the specific and already defined price formula between TCP and Sabic and on every shipment average urea price of leading markets will be applicable. Import of urea is part of the efforts of federal government to reduce the supply and demand gap in the domestic market and following the directive of the ECC, TCP has finalised urea import deal with Sabic to prevent shortage of urea and meet requirement of farmers during upcoming crop season, sources said.