Salt Shortage Is Far From Over

July 17, 2015

 

Everyone remembers last winter’s salt shortage. Well, this shortage is far from over.

If you’re beginning your process of hiring a contractor to service your commercial, industrial or retail site, then we suggest you look hard and fast and secure what you can find.  And if you haven’t started by now, then you’re probably going to be out of luck if you expect to pay prices for deicing applications similar to last winter.

Let me explain. At the beginning of last season, most road salt users (states, DOT’s, municipalities, and commercial contractors) were sitting on surpluses of salt as a result of recent light winters.

 

Then Winter 2014-2015 hit, and it continued to hit and never let up.  This was a winter like no other.  In some areas, it started in December and did not subside until the end of February.  I had conversations with folks who had crews working 45 and 60 days straight.  This was happening from Minneapolis to Washington DC.

In past winters, one area of the country would get hammered with unseasonable snow and ice while another received less than average snowfall.  This past winter if you were east of Fargo you got hit and you got hit often.

There were not a lot of blizzards, instead there was continuous snowfall including numerous 2-3 inch events.  The occasional 6 incher jumped in, and there were a few 12-inch events.  Also, take into consideration that from early January to about mid-February, the USA had temperatures that were record lows.  There were stretches where areas sat below 15 degrees for nearly a month.  Mostly it kept snowing, and as customers and contractors alike know, you plow and then you salt.  And last winter the industry used lots of salt.

DOT’s that stock as much as 600,000 tons of salt to cover heavy winters were reordering in January.  Those same DOT’s only used 400,000 tons the previous winter.  They were ordering nearly a full seasons supply of salt in mid-winter. Of course, so were commercial contractors.

Salt bins that for nearly two years were overflowing were suddenly empty. And by season’s end DOT’s had barely enough salt to get through the winter.

By the end of the season, contractors located east of Fargo were nearly totally depleted. Every contractor, every DOT, every city and every state faced the same scenario – just about out of salt.

This means that since March, salt mines have been working to replenish the supplies of every city, state, DOT and supplier they sell salt to – every single one.

The bad news?  The salt shortage is far from over.  Mines and suppliers will simply not have everyone replenished by the time this winter hits.  In fact, I have heard some suppliers lament that it could take as long as two to three years to catch back up.

I am certainly not in a position to accurately predict what will happen.  What I do know is if you have not begun to secure your contractor, under contract, for this winter, you had better get moving.  This is a classic supply-and-demand scenario. Since supply is short, those with a demand will pay the price.  Pricing for salt is already up 60-80%.  And, discussions with suppliers say it will soon be double last year’s prices.

 

So brace yourself for a salt price hike this season.

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