b. Operational costs
Origin labelling would result in significant operational costs due to the necessary adaptations of the
production process, of packaging and labelling practices and facilities.
Production: Every plant would need to adapt and invest in new storage facilities for the raw material
will need to be stored separately depending on the country and can´t be mixed as it is currently the
case. This would involve investing in new silos per plant (estimation: 50.000 €), new transportation
belts (50.000 - 100.000 €), new implementation into the production scheme and automation (50.000
€). Investments in separated facilities will increase with the size of the company and the importance
of its international presence and trade. In some cases, expansion of the production buildings (that can
go up to 1.000.000 €) will be needed. In total, an investment of about 200.000 – 1.200.000 € per plant
could be required, especially in the case of large companies. This is to be followed by an increase in
maintenance costs (50.000 € per year per plant).
Logistics: as customers require clean batches, producers will no longer be able to supply a batch
containing salt from two ‘countries’. As already mentioned, this would take away a lot of flexibility and
cause more transportation costs. This could also result in more waste given that producers won’t be
able to mix two batches from one country because the batch-numbers wouldn´t be same. Cost
estimation is hard to predict.
Storage of finished products: due to the previously mentioned problems, new storage capacities will
be required (estimation between 500.000 and 1.000.000 € per plant).