Time for a salt policy that serves the sector’s needs
The commercial salt production in Bangladesh began in Cox's Bazar in 1961. Since then, the sector has expanded gradually through the support of government agencies and development partners. The Bangladesh Small and Cottage Industries Corporation (BSCIC) has remained central to this growth, shaping policies, managing production, and supporting producers. In 2024, the sector reached its highest output in 62 years, producing 22.34 lakh tonnes of salt, helped largely by an unusually long and intense heatwave. Currently, it provides livelihoods for 41,355 farmers and more than 2,100 mill workers. Nearly 50 lakh people depend directly or indirectly on the salt production value chain.
Despite its scale and significance, the sector remains informal in nature. Most workers in the sector, particularly in production fields and mills, continue to work in unsafe environments without any formal legal protection. They are not covered under the Bangladesh Labour Act of 2006. In addition, the sector suffers from low production efficiency, outdated techniques, significant post-harvest losses, unstable market prices, and weak regulation. The national salt policy was last revised in 2022. It is set for revision in 2026. This presents a timely opportunity to address the sector's most pressing concerns.
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Recently, a policy review based on a scoping study of the salt sector as part of the International Labour Organization's (ILO's) project was undertaken by Innovision. The review identified the rising cost of production as one of the most pressing issues. The cost of production of one mound (40 kilogrammes) of salt has increased from Tk 250 to Tk 400 in recent times, primarily due to a rapid rise in land rent. A 2020 report from the Bangladesh Trade and Tariff Commission estimated the average rent for one kani (about 0.6 acres) of land at Tk 25,000. Current data shows this has more than doubled to Tk 54,375. In the same period, the market price of salt has declined from Tk 526 per mound in 2023 to Tk 380 per mound in early 2024 and to Tk 247 per mound in 2025. This price is well below the average cost of production and has pushed many producers into a loss.
The situation is made worse by limited access to formal credit and the absence of secure land leasing systems. Most small-scale producers depend on advance payments from informal lenders, which weakens their ability to negotiate prices and often forces them to sell their harvest at lower rates. The uncertainty of land access in the next year also discourages producers from making long-term investments in land preparation. Further challenges persist in the field, as many salt-producing zones lack grid electricity, proper water channels, and short-term water storage facilities. These gaps reduce efficiency and restrict producers from adopting more sustainable production methods.
Processing is another critical challenge. Despite producing 95 percent of the country's raw salt, Cox's Bazar lacks advanced processing mills, forcing product transportation to Dhaka, Chattogram, and Narayanganj, which adds costs and reduces quality. A few large firms operate vacuum evaporation mills requiring heavy investment and low-cost gas supply, giving them market power and creating pricing distortions. Processing losses are also high, over 40 percent in vacuum mills and more than 20 percent in traditional and mechanical mills. While the tariff commission estimated an average loss of 22 percent, policy still assumes 17 percent loss, showing a gap between policy and reality.
Accurate demand estimation is a major gap in the current salt policy. The 2022 policy divides demand into edible, fisheries, livestock, and industrial, but the categories lack clarity. Edible demand is based on a per capita intake of 14 grams, a figure that lacks empirical support and exceeds the World Health Organization's recommended limit of five grams. It is also unclear whether fisheries include fish feed and fish processing, or if livestock covers both feed and leather processing. Our study identified 14 distinct salt-consuming sectors, where human consumption accounts for only 26 percent of total demand, fisheries and livestock together represent 42 percent, and the industrial sector accounts for 32 percent. The industrial growth projections, drawn from the 2020 Tariff Commission report, assume growth rates of five percent in 2021, 10 percent in 2022, and 15 percent from 2023 onward, but these estimates are not backed by evidence.
The issue of imports adds further complexity. Although domestic production is more than sufficient to meet edible salt needs, Bangladesh continues to import over 10 lakh tonnes of salt and raw materials annually. These imports peak during the off-season, especially between July and December, raising the possibility that imported salt enters the edible market and pulls prices down. In many cases, these imports are necessary because certain industrial sectors require higher-grade salt that local producers cannot supply. Yet, gaps in documentation, weak customs verification, and opaque supply‑chain arrangements create opportunities for misdeclaration and exploitation by influential business interests.
As the 2026 salt policy review approaches, addressing structural gaps in the sector is critical. Rising production costs, insecure land access, and reliance on informal credit have squeezed small-scale producers, while inadequate infrastructure and limited processing technologies constrain productivity. Market distortions from a few large firms and high processing losses emphasise the need for accurate data. Clear demand estimation, identification of salt-consuming sectors, and updated growth projections are essential for effective planning. Persistent imports add pressure to the market, emphasising the need for stronger monitoring and regulation. Strategic interventions, including secure land leasing, affordable finance, targeted infrastructure, decentralised processing, and strengthened governance, can improve efficiency, equity, and resilience. Enhancing working conditions, safeguarding labour rights, and supporting micro and small enterprises in product diversification are also vital.
Although often overlooked, salt remains vital to both livelihoods and industry in Bangladesh. A grounded, data-driven, and inclusive policy can transform the sector into a stable source of rural employment, a driver of industrial growth, and a model for market system reform.
Mohibbullah Al Maruf is an environmental economist working at Innovision Consulting Private Limited. He can be reached at mohibbullah96@yahoo.com.
Views expressed in this article are the author's own.
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