KARACHI: At a time when fertilizer costs are shooting up across the globe due to the Hormuz crisis, Pakistan’s farmers have reason to breathe easy. Unlike the rest of the world, local urea prices here remain steady — giving our agriculture sector a rare edge and much-needed relief.
While international markets are rattled by soaring prices, Pakistani growers continue to buy urea at around PKR 4,400–4,450 per bag — far cheaper than the global rate. Thanks to strong domestic production and healthy stocks, the country’s fields are shielded from the turmoil abroad.
Brokerage house Arif Habib Limited noted in a recent update that international urea prices have jumped nearly 65 percent — from USD 411 per ton in February 2026 to USD 679 per ton — as about one-third of global trade flows through the disrupted Hormuz passage. Yet, Pakistan’s domestic market has stayed largely insulated. Local urea prices hover around PKR 4,400–4,450 per bag, translating into a widened discount of roughly 53 percent compared to global equivalents, versus a historical average of 30 percent. With import duties factored in, the gap is even larger.
Local Urea Prices Steady vs. Global Markets Surge
* The US–Iran conflict has driven global urea prices up ~65% from USD 411/ton in Feb’26 to USD 679/ton, as ~1/3 of global trade flows through the disrupted Strait of Hormuz.
* Pakistan, however, remains insulated: local urea… pic.twitter.com/mVP7kq1ee9— Arif Habib Limited (@ArifHabibLtd) April 4, 2026
Domestic Production Keeps Prices Steady
A little research shows industry players Engro Fertilizer (EFERT) and Fauji Fertilizer Company (FFC) continue to run plants on locally available natural gas, avoiding the LNG feedstock disruptions that have hit Gulf-based exporters. Pakistan’s urea production has carried on without major interruption, ensuring steady supply.
Following heavy discounting in December 2025 — EFERT offered PKR 400 per bag and FFC PKR 150–200 — record sales of 1.36 million tons were reported. EFERT has since scaled back discounts to PKR 250 per bag and, more recently, PKR 150, while FFC withdrew its concessions earlier. Even so, the domestic price remains far below landed import costs, which now stand at PKR 13,700–14,700 per bag.
Stocks Cushion Kharif Season
Information available online shows Pakistan currently holds around 0.9 million tons of urea inventory, enough to cover the upcoming Kharif cropping season provided plants continue normal operations. This buffer, coupled with strong domestic production, has shielded farmers from the global price shock.
Global Alarm, Local Relief
Research by MM News underscores the contrast: UN agencies warn of fertilizer shortages threatening global food supply chains, with fears of reduced crop yields, higher food prices, and hunger risks in import-dependent countries later in 2026. Gulf producers, responsible for nearly half of seaborne urea trade, have seen exports choked by the Hormuz crisis.
For Pakistan, however, the story is different. Minimal reliance on imported urea, adequate stocks, and robust local manufacturing capacity mean farmers are spared the worst of the turmoil. Analysts caution that the insulation is specific to urea — other fertilizers like DAP remain heavily import-dependent — but for now, the country’s agriculture sector enjoys a rare edge in cost stability.
