A recently published report from the Ministry of Mines indicates that long-standing issues in the salt supply chain remain unsolved, with over 38 million quintals of surplus sitting idle in storage in the Afar Regional State.
Ethiopia’s salt demand, including table salt for households and industrial salt for tanneries, breweries, and others, sits at a little over 700,000 quintals a month, according to the report.
However, supply from the Afar region, home to the country’s largest salt deposits and 92 percent of its salt supply, has been facing disruptions for more than a year following regulatory changes.
Last year, the Afar regional administration moved to bar private salt distributors from the market and hand over exclusive rights to a new state-owned enterprise dubbed the Afar Mines Corporation. The federally-owned Ethiopian Industrial Inputs Development Enterprise (EIIDE), which had previously been engaged in supplying salt to manufacturing industries, was also sidelined as a result of the move.
Nonetheless, the Corporation has thus far been unable to resume business as it is unable to access salt treatment chemicals mandated by federal law.
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During a parliamentary hearing in February this year, officials from the Ministry of Industry complained to MPs that industries were running dangerously short of salt due to the restrictions placed in Afar. Salt prices have spiked since then.
“This is a paradox. In one place, there is a surplus and huge [volumes of] salt produced and stored. On the other side, there are very many industries that have stopped production due to a lack of salt. We demand Parliament intervenes. This needs policy intervention. It must be led by market law,” Melaku Alebel, minister of Industry, told the MPs at the time.
Parliamentarians responded with alarm, agreeing to the need for federal intervention.
“Are regional states not members of the federation?” asked Amarech Bekalo (PhD), then chair of the parliamentary standing committee for Industry and Mining Affairs. “Where are we heading? There is salt mined and accumulated in one region, but manufacturing industries in the country are stopping production due to a lack of salt. Hides and skins are going to waste across the country. The federal government must ensure the constitution is being upheld. The regional state with the salt cannot stand alone. Any resource found in one regional state belongs to all and must be shared.”
The Mines Ministry report indicates there are currently 88 companies directly involved in the salt value chain, of which 29 are involved in iodization, while the remainder are tanneries, textile manufacturers, and beverage and chemical industries that require washed salt.
The report highlights a range of problems in salt production, value addition, and distribution.
The primary problem lies in a directive from the Ministry of Trade and Regional Integration mandating that no salt leave the Afar region without being treated with naphthalene.Accessing the chemical and the machinery required to mix it with salt has proved difficult, according to the report, leading to surplus accumulation.
The salt business is also dominated by a handful of businesses, posing a different set of problems to the industry, according to the report.
Industries are unable to access the salt supply on time while others have trouble gaining access at all, leading to production shortfalls, according to the Ministry.
The report recommends a review of the naphthalene directive as a way to solve the problems. It also calls for an end to the market’s monopolistic tendencies and encourages industries and factories that use salt as an input to digitize their transaction systems.
Afar’s Afdera, Dobe, and Berhale districts account for 74, 15, and three percent of the country’s salt supply. The Somali region’s Hargele Zone accounts for the remaining eight percent of production.
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