Poor demand of soda ash in both local and regional market continues to stall production of the country’s sole producer of soda ash, Botswana Ash (Botash).
In the 2012 financial year, Botash experienced a production shortfall by 23 000 tones against a set target of 280 000 tonnes, producing 257 000 tonnes of ash.
Caroline Mabua, the Public Relations Officer at Botash, said production had to be stopped due to full warehouses both in Sua Pan and Johannesburg. Mabua attributed the production shortfall to lack of demand.
The soda ash company has been grappling with dumping in their South African market by the US firms. Soda ash and salt producer’s margins had increasingly come under severe pressure as US firms used their competitive advantage to undercut the local miner.
In the year under review Botash exported 7 197 tonnes of soda ash to the deep sea markets. Botash is still supplying the deep sea markets with an intention to supply 23 000 tonnes during the 2013 financial year and efforts to secure more new markets for their products are continuing.
Mabua said the mine had to rent out warehouse space in an effort to avoid production disruption. Meanwhile, efforts to break into the DRC market are underway, as they are currently pursuing leads with some mining companies in the DRC who use soda ash in their production processes.
The mine continues to flex its muscles into salt production as the soda ash business is facing challenges. “Efforts are also continuing to expand our salt exports throughout Southern Africa,” said Mabua, adding that total salt production for 2012 closed below budget at 431 000 tonnes due to logistics issues. The logistics challenges have now been resolved.
Looking ahead, Soda ash production budget for 2013 is just over 270 000 tonnes. Mabua said production has been limited due to reduced demand from customers as they face low demand for their products due to the economic recession as well as cheap imports into Southern Africa. Total salt production budget for 2013 stands at just over 482 000 tonnes, representing an increase of 12 percent.
Soda ash is the main revenue contributor at 71 percent current actual year to date and 60 percent of budget.
