Private investors to invest in salterns

Private investors to invest in salterns

• 2 decades have passed since the implementation of the National Salt Iodization Programme in Sri Lanka but there have not been any studies done among pregnant women to assess the knowledge and practices related to iodized salt and its usage.
• Even in countries with very good iodine nutrition, there is evidence that pregnant women are susceptible to iodine deficiency.
• Iodized salt is the main source of dietary iodine in Sri Lankan population and it has been the main strategy to control the iodine deficiency disorders. In this study sample most of the pregnant women (>90%) were aware of iodized salt and about 90% knew the connection between iodine deficiency and goiter.
• Yet, only about half of the subjects (51.8%) were aware of the importance of consumption of iodized salt especially during pregnancy. This shows that the public awareness about iodized salt is not satisfactory.
• Similar results have been reported in studies done in Ghana a developing country in sub-Saharan Africa, where >90% of subjects heard about iodized salt and about 33% knew iodine deficiency causes goiter and in Iraq, Ebrahim and Muhammed reported that >92% of subjects heard about iodized salt and only 27.1% knew about the health benefits. Of the pregnant women who were in their second pregnancy or more (n=259), 45% have not received information on the importance of iodine during
• Iodine requirements are increased ≥ 50% during pregnancy. Iodine deficiency during pregnancy can cause maternal and fetal hypothyroidism and impair neurological development of the fetus. The consequences depend upon the timing and severity of the hypothyroidism; the most severe manifestation is cretinism.
• In moderate-to-severely iodine-deficient areas, controlled studies have demonstrated that iodine supplementation before or during early pregnancy eliminates new cases of cretinism, increases birthweight, reduces rates of perinatal and infant mortality and generally increases developmental scores in young children by 10-20%.
• Mild maternal iodine deficiency can cause thyroid dysfunction but whether it impairs cognitive and/or neurologic function in the offspring remains uncertain.
• Two meta-analyses have estimated that iodine-deficient populations experience a mean reduction in IQ of 12-13.5 points.
• In nearly all regions affected by iodine deficiency, salt iodisation is the most cost-effective way of delivering iodine and improving maternal and infant health.
• Everyone knows that there is a shortage of Salt now in the market. When you go to buy Salt, a packet which was Rs. 10/- to Rs.12/- one year ago, has gone up to Rs. 35/- to Rs.40/- an increase of over 300%, said Dr. Ravi Liyanage, Chairman/CEO of the Kingdom of Raigam.
• A saltern needs about 5 years to reach optimum operational level. Very high capital expenditure is needed.
• Raigam’s planned annual production capacity for 2010 is 25000 M/T which is 22-25% of the total consumption of Salt in the island.
• Raigam is the single share-holder of privatized Puttalam Salt Corporation (presently Putalam Salt Limited) and recently the company has bought Southern Salt Company in Bata Atha, Tangalla.
• In Maha Lewaya in Hambantota and the surrounding Salterns, the production has gone down in recent years.

Salt is a commodity that has an inelastic demand. That means, the demand for Salt will not change according to price; price has almost no effect on the demand.

The reason for this is that Salt is essential for food or beverage to taste the way it should and also because Salt has no substitute. To highlight this there is a saying that marriage without a quarrel is like a curry without Salt!

Market sources revealed that the price of a kilo of salt will escalate to Rs. 90 due to the drastic scarcity of stocks.

The mismatch between supply and demand was caused by the decline of salt production from Hambantota and Puttalam.

Therefor a kilo of salt generally priced at Rs. 30 a kilo will be increased to Rs. 90.

Sunshine is essential for the manufacture of Salt. That is why arid areas such as Puttalam, Hambantota, and Mannar are chosen to produce Salt.

After the recent tsunami, rainfall in these areas has increased considerably from about 900mm to 1200mm. Even South India where Salt is produced extensively, rainfall has increased beyond 1500mm.

This has resulted in the production of Salt in Sri Lanka going down to 100,000 M/T from 150,000 M/T in financial year 2007/2008. This is the main reason for the shortage.

OSL Take:

The changes witnessed over 2 decades in the salt manufacturing industry of Sri Lanka tells us of the growing potential of salt production now, and paves the way for overseas investors to take part in it.

The government with its investor-friendly policies invites potential investors to come in on the PPP investment model to take up these lucrative opportunities, and OSL is ready with detailed project proposals to do the matchmaking exercise.

So, call the biz-friendly OSL Team to learn more on the scope and the way forward.

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LOCATION : Puttalam, Hambantota, and Mannar
SECTOR : Manufacturing & Engineering
OPPORTUNITY CODE : VBS/OP/07072016/X-1

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