Challenged Ninh Binh plant restarts next week
Challenged Ninh Binh plant restarts next week
Vietnam National Chemical Group (Vinachem)’s $667 million nitrogenous fertiliser plant in Ninh Binh may restart its operation next week, after a two months temporary halt, according to newswire Tienphong.vn.
On June 1, the plant’s management board convened workers to restart machinery and go through operation regulations.
However, Chu Van Tuan, deputy general director of Vinachem, said that although the plant would restart operations, it would have difficulty maintaining itself because the already high production expenditures are increasing even further, while fertiliser prices are in a continuous plunge on the domestic market.
Besides, Ninh Binh nitrogenous fertiliser plant is fuelled by coal, while other such plants run on gas. While gas fuel prices are on a continuous decrease, coal prices are immobile, leaving the Ninh Binh plants’ unable to compete with other plants.
Tuan added that farmers in the north usually used phosphate fertilisers instead of nitrogenous fertilisers, thus Ninh Binh nitrogenous fertiliser plant would continuously have difficulty in selling its products.
Thus, Vinachem has submitted 11 separate plans to deal with the above difficulties to the government and the Ministry of Industry and Trade, one of which is closing the plant.
Previously, the plant was forced to call a temporary halt to its operations in late March by its continuous losses. The company temporarily laid off 400 of its 1,100 workers, paying the monthly unemployment allowance of VND3.1 million ($139.37) to each in order to convene them when the plant opens its gates again.
The plant’s construction was kicked off in May 2008 in Ninh Binh’s Khanh Phu industrial zone and came into operation in 2012, after 42 months of construction.
During the nearly four years since then, the plant has been operating at a continuous deficit, accumulating altogether over VND2 trillion ($89.9 million) in losses. Notably, in 2012, the company’s losses amounted to VND75 billion ($3.37 million), which increased to VND759 billion ($34.12 million) in 2013, VND500 billion ($22.48 million) in 2014, and VND370 billion ($16.63 million) in 2015.
