Salt producers count their losses

Update: March, 30/2015 - 09:34
In Bac Lieu Province, the delta's main producer, prices have gone down from VND1,200 per kilogramme around two months ago to VND700 – VND800 now. — Photo VNA

Compiled by Le Hung Vong

Salt producers in coastal Mekong Delta provinces have incurred losses since salt prices have gone plummeted in the past month.

In Bac Lieu Province, the delta's main producer, prices have gone down from VND1,200 per kilogramme around two months ago to VND700 – VND800 now.

Huynh Van Dau, a producer in Hoa Binh District's Vinh Thinh Commune (in Bac Lieu Province), said locals were unhappy with the sharp fall in salt prices.

Nguyen Van Thua, deputy chairman of salt production co-operative Diem Nghiep in Dien Hai Commune, said the co-operative was selling salt for VND27,000 – VND28,000 per da (30kg).

He said members were holding their stocks and waiting for higher prices.

"This year's production has doubled but prices went down sharply. Diem Nghiep members have to work several months under the baking sun. But what they get is just some VND2 to 3 million (a bit over US$100) per month."

He said last year Diem Nghiep Coop had a contract to sell all its salt to a company for VND1,000 per kilogramme, but the contract was not renewed this year.

Now salt was sold under shorter-term contracts, he added.

Mai Thanh Hung, deputy head of the Dong Hai District Division of Agriculture and Rural Development, said Dong Hai — the biggest production area in Bac Lieu — has over 1,900ha of salt marshes, mainly in Dien Hai and Long Dien Dong Communes.

Dong Hai farmers produced salt using the traditional methods, and supply far exceeded demand, causing prices to slump, he said.

But many local farmers believe that the Ministry of Industry and Trade plans to import large quantities of salt and that this is the main cause for the sharp decline in prices.

Bac Lieu salt producers and workers are hoping for helpful Government policies.

According to the local Department of Agriculture and Rural Development, Bac Lieu has 2,587ha of salt marshes now.

The province has drawn up a programme to restructure salt production by 2020 to improve value addition to ensure sustainable development of the industry.

New investors

Quang Nam Province authorities have identified new investors for the US$4 billion South Hoi An Resort project.

On March 23 the local People's Committee issued licences to Hong Kong's Chow Tai Fook and Macau's Sun City to replace Genting Berhad Malaysia (GENM) as the investors of the integrated resort in the central province's Duy Xuyen and Thang Binh districts.

Genting Berhad Malaysia had pulled out of the project in 2012.

According to the Chu Lai Open Economic Zone Authority, South Hoi An, which was licensed in December 2010, will have hotels, resorts, villas, some 2,500 apartments for sale, and a casino meant for foreigners.

Originally, investment fund VinaCapital held an 80 per cent stake and GENM the rest.

But after GENM withdrew, VinaCapital took efforts to identify other investors in its place.

It also proposed a reduction of the project area from 1,538ha to 1,000ha.

In November 2013 VinaCapital introduced Peninsula Pacific to Quang Nam authorities as GENM's replacement.

VinaCapital also asked to develop and operate a golf course in the resort.

In April last year Quang Nam authorities agreed for Peninsula Pacific to replace GENM as the investor.

But recently that was overturned and it named two others — Chow Tai Fook and Sun City – as the investors along with VinaCapital.

Under the new terms of the licence, the $500 million first phase of the project will comprise the hotel, golf course and casino to be finished by late 2018 or early 2019.

But the US$4 billion investment capital registered in 2010 remains unchanged.

Rice noodles

Despite the tough competition in rice export markets, Vietnamese rice products like noodles sell very well around the world, including in major markets like Japan, France and the US.

Bich Chi Joint Stock Company in Sa Dec city, Dong Thap Province, a foodstuff firm specialising in rice noodles, has in fact been unable to keep up with the demand.

Last year Bich Chi enjoyed net profits of over VND50 billion (over US$2.3 million), which mainly accrued from export of rice products.

The profits were higher than the company's registered capital, managing director Pham Thanh Binh said.

The company specialises in four main products made from rice flour. Last year it turned out over 20,000 tonnes of products, including 60 per cent for exports with the rest supplied to supermarkets around the country.

It sells its products also to Europe, Southeast Asia, and South Korea.

"We are happy to see Bich Chi noodles used in the pho served at restaurants in Tokyo," Binh said.

"Many Japanese are fond of pho."

In Paris, over 120 restaurants use Vietnamese rice noodles, which are popular with local guests.

In early March two Japanese experts were sent to Sa Giang Import/Export Co in Sa Dec city to check out the production lines making pho noodles before a contract was to signed to buy the company's rice noodles for Aeon supermarkets all over the world, according to Mat Bich Khuay, deputy general director of Sa Giang.

She said Sa Giang had been negotiating with the famous cook Robert Danhi for production and export of pancakes made from coconut to the US market.

The American culinary expert said the pancakes must be made with Mekong Delta rice flour and coconuts from Ben Tre Province and ingredients specified by him.

Binh said the prices of export products made from rice flour fetched four times the price of rice, explaining that rice was exported for over VND10,000 per kilogramme against $2 or VND44,000 for rice noodles.

"We need 1.1kg of rice to produce 1kg of rice noodles."

Export of rice flour was also profitable, he added. — VNS