Fertiliser usage in Pakistan has increased on a year-on-year basis, indicating that agricultural activity remains largely intact despite widespread perceptions that recent floods severely damaged the farming sector. However, sector stakeholders say the rise reflects price adjustments, policy support mechanisms and shifting crop patterns rather than any broad-based expansion in cultivation or a meaningful improvement in farm incomes.

According to data from the National Fertilizer Development Centre (NFDC), urea offtakes rose by 26% year-on-year and 36% quarter-on-quarter to reach 2.5 million tonnes in the fourth quarter of calendar year 2025, compared with 2.0 million tonnes in the same period last year, according to Insight Securities. The brokerage noted that the increase was likely driven by the Rabi season and advance buying by dealers amid attractive discounts.

In contrast, DAP offtakes declined by 21% year-on-year to 543,000 tonnes, compared with 690,000 tonnes in the same period last year.

The broader macroeconomic outlook has also improved. In its latest Monetary Policy Committee statement, the State Bank of Pakistan said recent information on sowing patterns and satellite imagery pointed to encouraging prospects for the wheat crop. Combined with improved performance in large-scale manufacturing, strong remittance inflows and resilience in agriculture, the central bank revised its growth outlook upward. Real GDP growth for FY26 is now projected at 3.75-4.75%, compared with an earlier estimate of 3.25-4.25%.

Despite the improving macro picture, conditions on the ground remain mixed. Muhammad Ali Iqbal, President of Concave Agri Services, said fertiliser consumption had risen mainly due to changes in usage intensity and crop choices, not because of any significant increase in cultivated area. He said prices were higher than in earlier periods, but fertiliser use had still increased year-on-year, adding that government interventions had helped stabilise demand.

Iqbal pointed to the Kissan Card as a key policy tool that previously supported farmers' access to inputs, shaping purchasing behaviour and sustaining usage despite financial pressure.

On cropping trends, he said wheat remained a priority, but sowing declined this year due to caution following last year's setback. Sugarcane production, weak last year, is expected to recover, although water shortages could emerge later. Fertiliser demand is also shifting geographically, with higher urea use in maize-growing regions.

Mahmood Nawaz Shah, President of the Sindh Abadgar Board, linked higher fertiliser uptake mainly to lower urea prices rather than improved agricultural fundamentals. He said that after years of high prices, the recent reduction had pushed demand up sharply, with some dealers selling below official rates.

He said farmers responded predictably by purchasing according to their capacity but questioned whether higher sales reflected stronger performance. He said there was no major increase in sowing area or farm revenues to justify the reported rise.

Iqbal said rice output fell short of expectations, while floods caused major damage to livestock and maize, disrupting fodder supply. This has driven sharp increases in fodder prices, with berseem doubling and some varieties tripling in certain regions.

The fodder shortage has directly affected the dairy sector. Citing a microfinance study, Iqbal said average daily milk yield for small farmers had dropped to three to four litres per animal, well below the potential of 10 to 12 litres, due to inadequate feed quality and nutrition.

He also noted a shift towards oilseeds and pulses such as chickpeas, which farmers see as less risky than wheat. Shah added that delayed fertiliser purchases after flooding could be distorting year-on-year data, noting that reported increases in wheat area were too small to explain the surge in demand.