BD hikes gas tariff for fertiliser factories by 83pc

Staff Reporter:

Bangladesh has raised the gas tariff for fertiliser factories by 83 percent, with the price per cubic metre increasing from Tk 16 to Tk 29.25, the Bangladesh Energy Regulatory Commission (BERC) announced on Sunday. The new rate will come into effect on 1 December.

The revised tariff will apply to all major distribution companies, including Titas Gas Transmission and Distribution Company Ltd, Bakhrabad Gas Distribution Company Ltd, Jalalabad Gas Transmission and Distribution System Ltd, and Karnaphuli Gas Distribution Company Ltd.

BERC said the decision follows a public hearing held on 6 October, where gas distributors proposed raising prices for fertiliser production. The distribution companies had sought a 40 percent hike, arguing that it would allow them to import an additional seven cargoes of liquefied natural gas (LNG) to ensure steady supply to fertiliser plants.

The increase in gas prices is expected to push up production costs for fertiliser. Currently, producing one kilogram of fertiliser costs Tk 38, while farmers buy it at Tk 27 per kg due to heavy government subsidies.

Bangladesh’s domestic fertiliser output meets only about 20 percent of national demand, with the remainder imported. For urea—the most widely used fertiliser—local factories supply less than one-third of the required amount. Urea accounts for about 46 percent of the country’s annual fertiliser consumption, which stands at roughly six million tonnes.