smtp_auth login plain;

Sets permitted methods of SASL authentication for SMTP clients. Supported methods are:

login

AUTH LOGIN

plain

AUTH PLAIN

cram-md5

AUTH CRAM-MD5. In order for this method to work, the password must be stored unencrypted.

Allows to specify the SMTP protocol extensions list to be passed to the client in the response to the EHLO command. Authentication methods specified in the smtp_auth directive are automatically added to this list.

It makes sense to specify extensions supported by MTA to which clients are proxied (if this extensions are related to commands used after the authentication, when nginx transparently proxies the client connection to the backend).

The current list of standardized extensions is published at the www.iana.org.