The proposal was made to minister of Industry and Trade, Tran Tuan Anh when he visited the plant on February 21.
At the meeting with the minister, the company’s general director, Vu Van Nhan, said that the loan will help boost the plant’s production activities after it resumed operation in January 2018.
“We have mobilised VND63 billion (USD2.78 million) from customers for the plant’s operation since January this year,” Nhan told the meeting. “But to have that source of money we are having to sell our products at cheap prices. So need more capitals so that we can better control the market prices.”
The director shared that the plant is now producing 1,300 tonnes a day and have made approximately 27,000 tonnes of fertiliser this year of which 22,000 tonnes have been sold before the Tet holiday.
Despite positive signs, Nhan said that the plant is still facing numerous challenges especially in sources of capital to maintain stable operations.
“We need more support from banks,” Nhan added. “It will cost us some VND40 billion a week to buy coal only for maintaining production, which is a big challenge which may make us being unable to meet the target of producing 120,000 tonnes in the first term of this year”.
The director called for minister Tran Tuan Anh’s support so that they can have an emergency bank loan of VND350 billion to maintain operations. Nhan has also proposed and additional bank loan of over VND200 billion over three years to restore the plant’s facilities in 2018.
Addressing the meeting, minister Tran Tuan Anh pointed out the causes of the great losses at the plant, including weak management, slow actions by the Vietnam National Chemical Group and Ninh Binh Nitrogenous Fertiliser Company, as well as labour skills.
“But we have to save the plant by all means,” the minister stressed. “We will cooperate with the Vinachem to find out the best solutions to the plant’s problems. But the Ninh Binh Nitrogenous Fertiliser Company will have to save them first by improving their product’s quality and quantity.”
The USD667 million-invested plant, one of the ministry’s top 12 loss-making projects, started operations in 2012 with designed annual capacity of 560,000 tonnes of fertiliser.
Since its inception, the plant has continuously incurred losses with a total sum of over VND3 billion (USD132.22 million) by mid 2017.