Low output to make salt costlier

Production may be delayed by three months, fall over 35-40 per cent on extended monsoon.

If rising onion prices were not enough, the extended monsoon and excessive winter are set to rub salt on consumers’ wounds. With production declining 35-40 per cent, salt prices are set to move upwards. Moreover, production may be delayed by over three months.

The extended monsoon has caused nearly 75 per cent dilution in salt pans. On the other hand, excessive winter has caused slow evaporation of water in these pans, which further delayed the production, an industry source said.

“The salt production in India may dip over 35-40 per cent in the current year. The production was affected mainly due to extended monsoon, which lasted till November, while the excessive winter has slackened the evaporation process in the salt pans. This will delay the salt production by minimum 120 days,” said a top official at Indian Salt Manufacturers’ Association.

On an average, India produces around 18.5-19 million tonnes of salt, which is supplied for three broad usages — edible consumption, industrial demand and export markets. The demand for edible salt is pegged at around 6.5 million tonnes per annum, while industrial demand stands at around 7.5-8 million tonnes. India exports around 2-2.5 million tonnes of salt every year, sources informed.

“Usually, the production starts in October and continues till June. But this year, monsoon extended till November-end, which disrupted production in salt pans. Stocks are low and new stock will take time to come in the market, hence the prices will shoot up in the next few months,” said a manufacturer in Saurashtra.

The rise in salt price would also affect the industries adversely with the commodity being one of the key ingredients for the soda ash industry.

“Prices have already started rising and it is badly affecting our costs as salt is the key ingredient for the soda ash industry. A further downfall in the availability of salt may affect the production of soda ash adversely,” said Sunil Bhatnagar, president (sales and marketing), Gujarat Heavy Chemicals Limited (GHCL). GHCL has a manufacturing capacity of about 2,200 tonnes per day (TPD) and the plant is operating at full capacity at present. However, a possible rise in prices may cause the companies to reduce their soda ash and caustic soda production. Key consumers of industrial salt include some of the majors like Nirma, Tata Chemicals, Saurashtra Chemicals and GHCL.

Meanwhile, experts are of the opinion that the price pressure could be eased by importing larger volume of salt. Industry sources informed that salt imports are allowed duty free under the open general licensing ever since 1997.

But in the wake of recent global climatic disturbances that gripped entire Europe with snow and China with floods, the demand for salt in the international markets has also gone up considerably. India is believed to be getting export enquiries from countries like Japan, China and parts of Europe, other than the traditional buyers like Nepal, Bhutan, Bangladesh.