2024 – a year of fundamental change in the salt industry

On February 24th, 2024 Mitsubishi Corporation agreed to sell its entire 49% stake in Exportadora de Sal, S.A. de C.V., to the Ministry of Economy of Mexico. The Mexican government is the current shareholder of the remaining 51% in ESSA, and will have complete ownership in the future.

Ending half a century of collaboration Mitsubishi – ESSA

The sale marks the end of half a century collaboration. In 1973, Mitsubishi started its engagement in the Mexican salt producer. The goal was to secure the raw material for Japan’s growing chlor-alkali industry. After a long period of growing chlor-alkali production and Japanese salt imports from Mexico, the trend reversed following the economic downturn in 2008.

Strategic importance of upstream integration declines with expected future development

The Japanese chlor-alkali production has been declining after the 2008 economic downturn. This trend is likely to continue. As a consequence, the upstream integration to secure salt supply is losing its strategic importance.

Lower consumption and announced capacity additions

The strategic importance to secure raw material from Mexico also declines with announced capacity additions. The Australian capacities additions for the Asian export market sum up to about 14 million tonnes in the next years.

The second big announcement of 2024

Last month, another important transaction in the global salt market had taken place with Dampier’s sale of its Australian MacLeod salt production plant. The price for the asset with a production capacity of 2.3 million tonnes had been US$ 251 million. The sales prices for the 49% share in the ESSA plant with a capacity of 8 million tonnes is US$ 87.6 million. The comparatively low price of the ESSA transaction indicates the difficult competitive position of the Mexican producer in the Asian export market. It also expresses the expected abundance of supply from geographically closer Australian sources.


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