It is a matter of great surprise that the authorities concerned are sitting cosy while a crisis is brewing up in the supply of urea fertiliser in the country. As reported in this paper, this may have severe consequences for production of Boro crop in the upcoming season starting from December next. The consumption of urea fertiliser constitutes almost half of the total fertiliser consumption in Bangladesh. On the other hand, Boro crop accounts for around 55 per cent of rice production in the country. Consequently, any disruption in the supply of urea fertiliser would severely hamper Boro production in the season to follow. This in turn may have serious implications on the country's food availability.
Reportedly, production of urea fertiliser in three factories under Bangladesh Chemical Industries Corporation (BCIC) has been kept suspended for months due to cut in the supply of natural gas. As is well-known, natural gas is the basic raw material for production of this fertiliser. Supply has been resumed in only one of the factories last week, but the fate of the other two still remains unclear. On scrutinising the figures, it is observed that production target of urea fertiliser during 2017-18 fiscal year was 902 thousand metric tonnes, while only 666 thousand metric tonnes could be produced up to February 2018.
Due to disruption in gas supply since April, it is most likely that there would be a large gap between the production target and the actual production. The production target has been set at 1.0 million metric tonnes this year, which is to be supplemented through import of 1.6 million metric tonnes by the BCIC. But regrettably, even the potential demand for 1.0 million metric tonnes of urea fertiliser up to November cannot be met from the existing buffer stock. Consequently, the supply situation may break down even before onset of the Boro season in December.
Surprisingly, although gas supply to urea fertiliser factories was stopped in April, the Ministry of Industries has taken the initiative only recently to fix the matter, when immense harm has already been caused to the production cycle. The relevant officials are also putting up excuses in advance by saying that the import of additional fertilisers for meeting the deficit may take many months; consequently the crisis can be averted only by maintaining domestic production. But an examination of current arrangements reveals that the BCIC has been enjoying a monopoly in importing urea fertiliser for many years, mainly to meet the gap in demand and supply. Therefore, the BCIC could have gone for importing a larger quantity much earlier when there was disruption in production due to stoppage of gas supply. Official figures for the period between 2010 and 2018 supports this contention, which show that while the domestic production of urea fertiliser hovered around 1.0 million tonnes, imports have fluctuated between 1.1 million and 1.8 million tonnes.
Consequently, everything boils down to a lack of rigorous monitoring of the production and import situation of urea fertiliser by the Ministry of Industries and the BCIC and also absence of prompt remedial measures for rectifying the situation. The onus now lies squarely on them if any crisis hits the supply of this critical fertiliser during the come Boro season. In addition, the government may also consider breaking the monopoly of the BCIC in the import of this fertiliser and allow dependable private importers as well as public-private partnerships to enter the fray for improving the supply situation.
- Courtesy: The Financial Express /Editorial/ Jul 23, 2018
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