08 October 2008 15:28 [Source: ICIS news]
LONDON (ICIS news)--The failure of the Pakistan government to make fertilizer subsidy payments has prompted producers and importers to collectively raise phosphate fertilizer prices by over Pakistan Rupees (PRs) 2,000/50 kg bag ($26/50 kg bag), sources said on Wednesday.?xml:namespace>
Diammonium phosphate (DAP) prices ex-Karachi had risen to PRs 5,510-70/50 kg bag, from the previously agreed capped price at PRs 3,050/50 kg bag, sources said.
Importers said the move was a tactic to place pressure on the government to release funds due to producers and importers, some of which had not received subsidy payments since April.
The government earlier announced the PRs 2,200/50 kg bag subsidy on DAP in September in an attempt to keep domestic prices lower in order to stimulate farmer off-take in the face of rapidly rising international phosphate prices.
However, payments had not materialised as the government was understood to be under severe financial pressure as a result of the recent slide in its foreign reserves, stock exchange and currency.
($1 = PRs78.25)
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