Once a hub, Thoothukudi losing salt market share to Gujarat

MADURAI: Now, Thoothukudi, the largest producer of salt in Tamil Nadu, tends to lose its market share to Gujarat, the highest salt producer in India, due to soaring prices in the domestic market and declining stocks.

There has been a drastic decline in the production for the last three years in Thoothukudi, which witnessed the worst production in 2024 when only about 50 per cent was achieved due to excess rainfall at regular intervals, Michael Motha, salt manufacturer cum exporter and former Chairman of CII, Thoothukudi, told DT Next on Monday.

Gujarat, which had less rain, witnessed high production and as the production increased, its prices dropped. Since the market price is cheaper in Gujarat than in Thoothukudi, many buyers preferred Gujarat, which captured the market.

“From Thoothukudi, around two lakh tonnes would normally be catered to the needs of chemical manufacturing plants in Kerala and Puducherry,” Motha said.

The unexpected intervention of rains on Sunday would cause further production delays this year. Moreover, he said stocks have run down almost to nothing owing to adverse factors such as floods that struck Thoothukudi in December 2023 and subsequent spells of rain almost every other month last year.

MSP Thenraja, president, Tuticorin Salt Merchants Association, said the dwindling stocks have prompted the traders to rely on Gujarat, where some traders started travelling from Thoothukudi to procure quantities of salt. The dwindling stocks have triggered a surge in price in the local market and many traders could hardly afford it, he said.

According to D Chandra Menon, president, Tuticorin Small Scale Salt Manufacturers Association, just after Sunday’s rain, market prices suddenly spiked to Rs 3,000 from Rs 2,600 a tonne.

Usually, Thoothukudi witnesses a new crop season after the Pongal festival, but due to monsoonal showers, production could be delayed by a month.

Stocks have almost dried up since December last and currently only about 10 per cent of stocks are available. If the production is delayed because of any further rain, the Thoothukudi market would see a further price increase in the coming days, he said.