AHMEDABAD: Salt production has started in the Kutch belt of Gujarat and the Sambhar-Phalodi belts in Rajasthan. Export orders are expected to increase with demand coming from China and South Asian countries. Salt prices increased post-Japanese tsunami earlier this year and have been stable since then.

“Salt production in Rajasthan is in full swing. By mid-December, the production will begin from Covelong, Marakanam, Cuddalore, Vedaranyam, Tuticorin and Nagercoil in Tamil Nadu along with Andhra Pradesh’s Naupada to Isakapalli. By January, the production will begin from south Gujarat (Kambhat to Surat) and Palghar, Rai, Wadala centres of Maharashtra,” said BC Raval, secretary, Indian Salt Manufacturers Association.

“Flooding, un-seasonal rains, foggy weather in China and Australia have ensured the demand picking up from Japan, Bangladesh, Nepal, Vietnam, Indonesia and Malaysia for the industrial salt. Exports in this calendar year (till date) have touched 3.8 million tonne and we expect it to cross 4.3 million tonne by December-end. On an average, India exports 2.5 million tonne salt,” said Raval, who is also the general manager of Solaris ChemTech Industries, a part of the $4-billion Avantha Group.

India is the third-biggest salt manufacturer in the world after the US & China. Salt production in India is to the tune of about 19-20 million tonne per annum, of which Gujarat produces 70%. In the domestic market, over 5.5-6 million tonne is used by the edible salt industry, 8.5 million tonne is used by the chlor-alkali industry (which mainly produces caustic soda, chlorine and soda ash) and over 2 million tonne in the water softening and tanning industry.

Export contracts were signed at $35-40 a tonne. “Raw salt prices are currently ruling higher by Rs 100 to Rs 150 than the previous year’s Rs 600-800 a tonne. In the retail, refined iodized salt was selling at Rs 1,200 to Rs 1,800 a tonne, depending on the brand and packaging, compared to Rs 1,000 to Rs 1,200 a tonne at the beginning of the year,” said Ahir Salt Industries’ manager Raju Bhai Ahir.

India’s edible salt market is 5.5-6 million tonne with branded salt market accounting for 1.3 million tonne. With a market share of 64% in the branded salt market, Tata Salt is the leading player, followed by Hindustan Unilever’s Annapurna, Nirma’s Shudh Salt and ITC’s Aashirvaad Salt. “On the backdrop of a balanced supply and demand, we see prices to remain stable. Exports will be the real game changer in the coming days,” said Tata Chemical COO (consumer products) Ashvini Hiran.

The largest producer of caustic soda in India, Gujarat Alkalies & Chemicals (GACL), expects salt prices to increase if pre-winter rain lashes across the state. “We are annually experiencing pre-winter rain showers, which delay production and increase prices by 15-20%. If there is no shower till March, the industry won’t have to worry,” said an official from GACL.

He added that all major players like GACL, Indian Rayon, Gujarat Fluorochemicals were on an expansion mode. “By 2014, GACL will increase caustic soda production by 300 tonne per day from the current production of 1,100-1,150 tonne per day,” he said, adding that the area under salt manufacturing is declining.