Worth its salt
The growth of Saltcor and the Donald Brown Group of Companies led one commentator to describe the salt business as ÔÇ£a better bet than producing goldÔÇØ. Ruari McCallion takes a closer look.
The reaction of most people when asked what comes to mind when they hear the word ÔÇÿsaltÔÇÖ will probably be something to do with the white stuff that is kept in the kitchen cupboard. There is, of course, a lot more to it than that. Salt is at the heart of the chemicals industry and is used in the production of chlorine, caustic soda, hydrogen and sodium for use in chemical multiplexes. Plastics use salt, so youÔÇÖll find it in the cabling and pvc components in cars. Offshore drilling rigs pump salt into the outer cavity of their drills in order to steer them. ItÔÇÖs an essential element in the food industryÔÇötake a quick look at the ingredients table of pretty much any food on the supermarket shelf and salt will be on the list.
Its industrial uses include testing of zinc platingÔÇöit is corrosive and salt spray will quickly expose any weaknesses in the surfacing. The agricultural sector makes use of salt in animal feed and as an ingredient in fertiliser. ItÔÇÖs a preservativeÔÇösalt beef isnÔÇÖt just a kosher dish, it lasts longer than untreated meat. And, of course, itÔÇÖs used in the home to help bring out the taste of carefully-prepared food. The importance of salt throughout history is even present in the word ÔÇÿsalaryÔÇÖ, which is derived from Latin and reflects the fact that Roman soldiers were paid a portion of their remuneration in salt.
Donald Brown established Saltcor in 1975, at a time when economic sanctions against South Africa were gaining momentum. His company was able to develop export markets in the Democratic Republic of Congo, Zambia, Malawi and Zimbabwe, earning vital foreign exchange and developing partnerships that remain strong to this dayÔÇöaround 20 per cent of the companyÔÇÖs annual production is exported. With headquarters in Tygerberg Business Park, Bellville, 12 miles from downtown Cape Town, and employing around 400 members of staff, the company is one of South AfricaÔÇÖs largest privately-owned salt producers.
Saltcor started some way up country, near Brandvlei in the north-western Cape. That region remains its main production centre, along with Upington. In its first year, Saltcor produced 18,000 tons; annual output is now running at over 140,000 tons. That growth reflects what the company describes as ÔÇ£the cautious but well-managed and controlled growth of the company over the yearsÔÇØ. Well-managed, clearly, and cautious it may well be; but it is still a year-on-year growth rate in excess of six per cent.
Brandvlei has conditions that are ideal for producing salt. It has an underground saline water supply that yields the material in very high quality and pretty high quantities also. Think of salt water and you think of the seaÔÇöocean water has about a nine per cent concentration. BrandvleiÔÇÖs salt content is about 97 per centÔÇömore than 10 times as salty as the Atlantic Ocean.
The process of extracting salt begins with mining through the salt pan. Saline water is extracted and run through crystallisation pumps, before harvesting of the raw salt after two to three weeks. SaltcorÔÇÖs extracted material is processed into a range of products, from rock and coarse salt to ultra-fine, and is sold in half-kilo to 50-kilo bags.
Salt production can be a bit of a paradox. It is capital intensive but the end result is regarded as a commodity and priced accordingly. Though it is a preservative of meat and fish, it corrodes the machinery that extracts it. It is used by pretty much everyone on the planet but SaltcorÔÇÖs salt pans are relatively isolated, which means that transport adds to the companyÔÇÖs costs. It is therefore a business that requires ingenuity and financial acumen in order to survive and prosper.
Brown and his teamÔÇöa number of family members are involvedÔÇöhave clearly mastered the art of tight financial management, and ingenuity goes without saying. The company invests carefully in technology that will help it to improve productivity and adopts modern practices that are appropriate to its situation. Together, they keep Saltcor on a par with the largest salt producers both in South Africa and in the world. Brown has described how he became fascinated with the salt industry at an early age; his passion for the business, boosted by ambition and strong dreams on the one hand and tempered by realism on the other, have helped his company to remain innovative, constantly seeking ways to improve and grow.
One of the foundations for Saltcor has always been strong relationshipsÔÇönot just with its customers, for whom the company has adopted a style of flexibility that enables it to adapt to their individual needsÔÇö but also on the supply side. Since it is extracting its own raw material, the machinery and equipment vendors have become a key focus for the company. Regular and scrupulously detailed maintenance helps to extend plant life but, even so, the corrosive environment means that machinery has to be replaced every five years. Saltcor is in a position to evaluate what is the most reliable and resilient machinery, but thatÔÇÖs only part of the story. Support in design, development and supply of spare parts is equally important, and the partnerships it has forged over the years stand it in good stead today, as a business with the reputation of a reliable producer.
Saltcor is an important part of the local economies in the Brandvlei and Upington regions. The company has established itself as a good commercial citizen, which is reflected in the Donald Brown Group being included in the 2010 edition of the South AfricaÔÇÖs Top Performing Companies list. Unlike tourism, for which Upington may be better known, salt production in this region is not seasonalÔÇöin contrast to many other salt production areas, SaltcorÔÇÖs resources provide continuity of supply the whole year round. ThatÔÇÖs good news for its customers, for its employees and for their families.
