It's corrosion and should only be on the positive terminal.

Sometimes you have a leaky seal around a post but this is rare these days.
More often the corrosion is because the + side of the battery attracts
oxygen ions from the air and the oxygen interacts with the metal, causing
the corrosion.

There are a lot of "fixes" you can buy but the best one is to put a drop of
oil on the terminal every time you check your oil. The oil will spread out
into a thin film & will protect the terminal from corrosion.

Some people put grease on the terminals. Grease will also work but you need
to make sure to cover the entire terminal, even the bottom edge of the
clamp. If you don't then any exposed metal will corrode.

Tom
www.kegkits.com

-----Original Message-----
From: Vanagon Mailing List [mailto:vanagon@GERRY.VANAGON.COM] On Behalf Of
Don Hanson
Sent: Wednesday, March 17, 2010 12:04 AM
To: vanagon@GERRY.VANAGON.COM
Subject: Cause of the white corrosion deposit around a battery?

  What makes the powdery white or gray deposits on some of the metal parts
around the van batteries?  Actually my Vanagon stays pretty free of the
deposit, but we inherited a 2.5 Subaru Forester that gets it bad.  We stored
it down in Californa during the summer and use it as a vacation car. We
opened it, around Xmas time to find the battery(disconnected but fully
charged)  was covered with a whitish powdery deposits, heaviest on the
hold-down ring and the clamps, but also under the batt on the tray.  I
bought another new battery...and cleaned everything up with baking soda,
like a good little car guy before installing that one...

  We brought it back to the NW...(shhhh...I'm hoping to finesse it (the
motor)  from my wife, eventually..for use in a ....) and I just noticed that
the hold-down clamps and the retaining ring is again almost pure white with
a fine powdery substance...Both my Ford Diesel trucks do the same thing, but
to a lesser degree.

  What the heck is this stuff and how do you prevent it forming?

  Don Hanson