As we kick off the New Year, winter seems to have arrived across most of the country. Following this column is research we conducted about contractor trends and attitudes with regard to salt and deicing.
I often get phone calls and emails asking me what I am hearing out there about the state of salt and deicing. This pertains to many subjects, but lately I have had a number of people inquire about what I am hearing about salt pricing. Many of you had a decent November for snow and ice management, but December was slow. So what has this done to impact pricing on salt? I have a made a number of calls on this subject an here is what I am hearing.
Salt pricing remains steady, with the cost remaining at preseason levels. The breathing room the salt companies were allowed by the slow December was just that, a little breathing room. It kept salt prices from climbing, but they have not come down. The only thing that is going to bring salt prices down this year is a mild winter.
Remember the scenario, everywhere east of North Dakota last year had a consistent winter. By the end of the year, everyone was out of salt. In a normal year, a 100,000 ton users may have 20,000 tons left over. So they replenish 80,000 tons. Prior to the start of Winter 2014-14 snowfighters needed to replenish all 100,000 tons. However, most did not do that. Instead, if they were a 100,000 ton user they increased their salt commitment to 120,000 tons, or whatever number they felt comfortable with.
So when you look at the number that way, the increase salt purchases is the difference between 120,000 and 80,000. That is a substantial increase in salt purchases. Take into account that the largest users of salt -- DOT’s, states, municipalities -- are using hundreds of thousands of tons of salt.
Many snow and ice management companies did the exact same thing and committed to more salt than usual this year.
So with the deplete supply at the end of last season, and the increased purchases across the board this year, and the somewhat mild winter to date, it seems pricing has stabilized somewhat.
However, it’s important to remember that the story on Winter 2014-15 has not ended, and the final chapters remain to be written.
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