Salt production hit by unseasonal rains

Manufacturers are already reeling under margin pressures due to fall in salt prices

Frequent unseasonal rain in the major salt producing regions of Gujarat and Rajasthan in the past two months have hit its production.

A duration of roughly 50 days, amounting to about three million tonnes of production, has been impacted. Industry sources said demand had begun to pick up when this took place, after being subdued for a long while.

India produces about 22 million tonnes of salt in a year. Gujarat produces 18 mt. Demand is about 21 mt — that for industrial salt is 8.5 mt, for edible salt is 7.5 mt and for export is five mt.

“This is the sixth or seventh time in this calendar year that there have been unseasonal rains. In normal circumstances, the salt season needs consistent rate of evaporation for about 310 days between October 15 and June 15, for decent production. With frequent unseasonal rain in Gujarat and Rajasthan in recent weeks, there has been a production loss of 50 days of salt,” said B C Raval of the Kutch Saurashtra Salt Manufacturers Association.

Bachubhai Ahir, former president of the Association, said with overall slowdown in the economy, especially in manufacturing, demand for industrial salt and export had been falling, resulting in a cut in price from Rs 650-700 a tonne to Rs 250-300 a tonne in recent times.

“It was only recently that demand had again begun to rise. Manufacturers are still under margin pressures, with prices continuing in the Rs 300 a tonne range. The unseasonal rains have washed out any production or capacity expansion plans that manufacturers had,” said Ahir.

“There will be decline in salt production due to unseasonal rain but this will not impact us much, since demand is already subdued. There has not been much industrial activity, as a result of which demand for salt is not likely to touch past levels. This has also impacted salt prices, which are down by almost half,” said R S Jalan, managing director of GHCL, a leading maker of soda ash, speaking for industrial consumers.

India traditionally exports salt to Southeast and South Asian countries.