Qafco Q1 profits and output fall y-o-y due to disruption from regional conflict

Qatar: Industries Qatar (IQ) posted a 28% year-on-year slide in Q1 fertilizer production volumes to 1.71m. tonnes that it blamed on the regional conflict, albeit precise details about urea and ammonia output from Qafco were not shared.

The company said its fertilizer segment reported a Q1 net profit of around $136 million for the first three months of this year, down 10% from the same period of the year prior.

“This decline in net profit was primarily driven by lower gross margin due to increased operating costs,” it disclosed.

“Operating costs increased mainly due to unfavourable inventory changes during the period coupled with increase in average feedstock costs.

“The segment’s revenue for the reporting period [$554 million) improved [6% year-on-year) mainly due to effect of higher average selling prices, partially offset by lower sales volumes.

“Average selling prices improved at the backdrop of stronger demand from key agricultural economies, supply-constraints and export restrictions.

“Sales volumes were down moderately due to lower production and the ongoing shipping and logistical challenges due to regional uncertainties.”

IQ confirmed plant utilisation and average reliability factors fell in March due to the increase in unplanned shutdowns arising from the previously announced war-related stoppage and production reduction.

Unusually, IQ did not provide any details of the sales volumes for ammonia and urea, or the average selling prices for both.

In a similar move, no exact details of plant run rates were provided for the 13 weeks to 31 March, and there was also no update on the status of the new 1.2m. tonne/year low-carbon (blue) Qafco VII ammonia project that had been expected to launch in the current quarter.

Earlier this year, IQ revealed Qafco’s ammonia and urea plants ran at 98% of nameplate capacity in Q4 2025, generating 145,000t and 1.48m tonnes of sale volumes, respectively.

Qafco’s Mesaieed production hub has six ammonia plants and half a dozen urea units, featuring an annual capacity of 3.84m. tonnes and 5.96m. tonnes, respectively.

Around six weeks ago, the President and CEO of QatarEnergy, owned by IQ, outlined the products badly impacted by attacks on its gas facilities, with urea and ammonia plants notably missing from the list.

Saad Sherida Al-Kaabi, who is also the Minister of State for Energy Affairs, said damage to its Ras Laffan Industrial City caused by midweek missile strikes, are expected to cost about $20 billion a year in lost revenue and take up to five years to repair.

While output of condensates, LPG, naphtha, sulphur and helium will be reduced for at least the next year, the senior official made no reference to long-term curtailments at Qafco’s Mesaieed base.