As a tropical country with 3,260 km of coastline and windy and sunny days throughout the year, Vietnam has major potential for salt production and could become an exporter, as it was prior to 2000. But Vietnam has, for the last decade, been a regular salt importer in increasing volumes and there is a large salt inventory almost every year, creating difficulties for salt farmers.

According to the Ministry of Agriculture and Rural Development (MARD), the country’s salt fields were estimated at 14,585 hectares in 2011, or 96.6 per cent of the previous year, and as at August 20 this year 709,836 tons of salt was produced, equal to 64.3 per cent of the figure for the previous year.

Salt demand in 2011, according to a MARD report, was around 1.35 million tons, while supply was estimated at 1.46 million tons, not to mention the existing inventory of around 217,036 tons from salt producers and enterprises as at August 20 this year, 35,392 tons of which were stockpiled in northern provinces, 48,133 tons in central provinces, and the remaining 133,511 tons in the Mekong Delta.

The Ministry of Industry and Trade (MoIT) convenes an annual year-end meeting attended by all concerned parties, in order to assess the situation before deciding upon the salt import quotas for the following year. At the 2010 year-end meeting, demand for industrial salt was predicted to reach around 237,000 tons in 2011, while Vietnamese salt companies could only produce some 70,000 to 75,000 tons.

As a result of this, and with the agreement of MARD and the Ministry of Finance, MoIT issued Circular No 45/2010/TT-BCT, under which MoIT granted a quota of 102,000 tons of industrial salt imports this year, of which 100,000 tons will be used for chemical production and the remaining 2,000 tons for the production of medical products.

Imports of industrial salt are reported to be carried out into two phases: 50,000 tons were already imported in the first phase and MoIT is reported to have discussed with MARD about the import of an additional 50,000 tons in the second phase. At this point, however, distribution to companies has not been decided upon.

MoIT cited the poor quality of Vietnamese salt and a lack of capacity among salt production companies as reasons for their decision to grant the import quota. And once again salt imports have stoked discontent among salt farmers and domestic companies. In mid-July this year, Vietnamese chemical production companies complained that they failed to find appropriate salt despite attempting to contact salt production companies, who either didn’t reply or could not complete the orders. “A survey shows that the output of Vietnamese industrial salt was insufficient to meet the demand for production of Vietnamese companies,” said Mr Luu Hoang Ngoc, Deputy Head of MoIT’s Chemical Department.

It is clear that salt farmers have been facing difficulties over the last two years due to the higher cost of living. While the price of almost all commodities has been escalating, the price of their salt has fallen substantially. The salt price stands at just VND550-600 per kg, while MARD revealed there is an inventory of 217,000 tons from last season plus 50,000 tons that were imported at the beginning of the year. In 2010 Vietnam imported 182,000 tons of industrial salt.

At a press conference held on September 13, in answering a question from the media concerning MoIT’s decision to import an additional 50,000 tons of salt in the second half of this year despite the large salt inventory, Mr Nguyen Nam Hai, Deputy Minister of Industry and Trade, said that the import of 102,000 tons of salt would satisfy only a small part of the 237,000 tons required by enterprises. “When giving permission to import such a small quantity of salt, MoIT already considered the impact on the domestic salt production,” said Deputy Minister Hai.

“We often think of giving priority to domestically made commodities, especially salt, as the good is facing difficulties in consumption,” he continued. “Honestly speaking, however, domestic salt lacks the quality required for the production of chemicals and medical items, as it is short of NaCl, calcium and magie in terms of technical criteria.” Nevertheless, Mr Le Tan Ban, Director of the Central Salt Joint Stock Company, does not share Mr Hai’s opinion, saying that Vietnamese salt is fully capable of replacing imports, especially salt from central provinces, which is known for its quality and NaCl content.

In terms of the technical capacity to turn ordinary salt into industrial salt, Mr Hai said: “This has become a headache for MoIT and MARD over the last couple of years. We are not sure if the processing of ordinary salt into industrial salt will guarantee the quality required. Moreover, such processing would be very costly. The price would be higher than for imports. And so far nobody has committed to covering the processing cost for salt farmers.”

Salt output in Vietnam usually far exceeds demand, by hundreds of thousands of tons. In 2011, according to a MARD forecast, despite unfavourable weather conditions salt output is estimated to reach over 800,000 tons, or 200,000 tons less than last year, and stockpiles will stand at 235,000 tons, or 51 per cent of the figure from a year earlier.

Chemical production companies argue that salt imports are needed because they are running out of industrial salt and the quality of domestic salt is poor. Meanwhile, salt production companies confirm that they are capable of producing over 100,000 tons of industrial salt this year and the quality is capable of replacing imports, especially salt produced in central provinces.

In regard to salt imports, senior economist Dr Le Dang Doanh is of the opinion that in most parts of the economy, not just salt, people still prefer imports regardless of the availability of domestic equivalents.

“Before 2009 the salt price was high and salt farmers enjoyed a good standard of living,” Dr Doanh added. “But since 2010, when salt imports were licensed, farmers have faced tough times. I think there should be a road map for salt imports, and relevant State agencies should conduct a survey of salt suppliers in the country and consider what type of salt needs to be imported and what type of salt can be provided by domestic salt production companies.”

It is time to think about mapping out a master plan for a salt industry, in order to improve the living standards of tens of thousands of salt farmers. With its favourable geographic conditions, Vietnam should not only try to avoid being an importer but should actually move forward to become a salt exporter, as it has in the past.