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Bangladesh Energy Regulatory Commission (BERC) will announce new gas tariffs for the state-run fertiliser factories today (Sunday).
The commission will announce the new tariffs on the basis of the public hearing held on October 6.
State-owned Petrobangla along with its subsidiary gas marketing and distribution companies sought a 150 per cent hike in the natural gas tariff-from Tk 16 to Tk 40 per cubic metre-for government-owned fertiliser plants.
While, state-run Bangladesh Chemical Industries Corporation (BCIC) stated that fertiliser production costs in state-run factories would be 32.60 per cent lower than the import costs if gas price is doubled to Tk 30 per cubic meter and annual production reaches around 2.0 million tonne.
Increased fertiliser production would only be possible if increased volume of natural gas is provided to the factories, the BCIC claimed during the public hearing.
According to the BCIC, the operating authority of state-owned fertiliser factories, the country requires around 3.0 to 3.2 million tonne of urea fertiliser annually.
Due to gas shortages, 1.6 to 2.1 million tonnes is required to be imported.
If gas is priced at Tk 30 per cubic metre and the BCIC can produce 2.0 million tonnes, the production cost per kilogram (kg) of fertileser would be around Tk 46.
Imported fertiliser costs around Tk 61 per kg, said a senior BCIC official.
He stressed that increased supply of gas to fertiliser factories must have to be ensured alongside the tariff hike.
Previously in 2022, the BERC raised the gas price by 259.55 per cent to Tk 16 per cubic metre from Tk 4.45 but gas supply to factories did not increase afterwards.
After the 2022 gas price increase, fertiliser factories have struggled to pay their gas bills. As of June 2025, they owed approximately Tk 10.39 billion to various gas distribution companies.
If the BERC raises gas tariff, the farmers will not have to count additional costs as there is no proposal to raise fertiliser prices, said a top official of the Ministry of Agriculture.
The BCIC in its report submitted to the BERC stated that current production cost of urea fertiliser is around Tk 38 per kg, while the BCIC sells to dealers at Tk 25 per kg and dealers sell at Tk 27 to farmers.
The government provides Tk 13 subsidy per kg to cover the trade gap. During fiscal year 2024-25, only Ghorashal Palash Fertilizer PLC operated at near full capacity.
Jamuna Fertilizer Company was completely shut for 361 days due to gas shortages. Chattogram Urea Fertilizer Company was closed for 273 days, Ghorashal Fertilizer Company for 198 days.
Ashuganj Fertilizer and Chemical Company operated only 3.75 per cent of its capacity and almost in all cases, gas supply declined compared to the previous year, the BCIC noted.
Petrobangla and its subsidiary companies argued that the proposed gas price increase for fertiliser factories is aimed at financing the import of additional liquefied natural gas (LNG) to cope with its chronic supply shortage.
These imports are intended to ensure uninterrupted gas supply to fertiliser factories, which have faced repeated shutdowns due to fuel shortage.
azizjst@yahoo.com