Winter 2020-21 got off to a fairly late start, but once it got into gear it stressed all of the systems and supplies in many regions. We’ve seen winter storms arriving a bit later in recent years and this was punctuated by the record snowfall in Colorado and Sierras in late March. Winter is not the same pattern of arrival as it was 20 years ago.
There is plenty of salt on the planet to supply for a nuclear winter, so start there. Deicing salts are readily available from nearly every corner of the globe, however storing them in the US snowbelt can be challenging and typically limits the amount that can be held at any location. Reaching these locations that are not “on the water” in the form of ocean or river access will require rail service to build the stockpile. A rail car can carry about 100 tons of salt on average. A barge carries up to about 15,000 tons but is limited by draft (depth of water) on the voyage and at the delivery location. Ships can carry from 45,000 to 80,000 tons of bulk salt depending on the ports of embarkation and discharge – again making sure that there is sufficient depth at the dock to accept the ship. “Lakers” and/or “Salties” are ocean going ships with shallow draft that typically are intended for Great Lakes service and can carry up to 40,000 tons depending on water levels. Understanding the way in which bulk salt reaches your supplier is important to appreciate the timing and limitations of reloading when supplies are hit hard and drawn down.
The seaboard stockpiles along the East coast are generally much easier to reload than interior US stockpiles that are serviced by river and lake delivery. Scheduling deliveries to the interior US by water takes a lot more planning and has transloading frequently involved (take from large ship to smaller barge or Laker). Disruptions in the rivers and lakes systems from high water or low water further frustrate these deliveries. Stockpiles cannot be refilled quickly due to the logistics involved of scheduling and booking a vessel, preparing the salt at the port to load, and then getting to the location after a voyage. Rail cars move very slowly in winter and can also takes weeks to reach their destinations after they leave the salt mine.
In my appearance on The Snow Magazine Podcast last fall, we talked about the potential for shortages that always exists in any region or geography if frequency of winter storms and demand pull hard on stockpiles. We did see that happen in the upper mid-west and in some sections of the mid-Atlantic and New England in February and early March. It was only a few weeks, but they were painful for those who had to live without deicer and endure the screaming from their customers who don’t understand how that can happen.
As you move into your off-season summer mode, be thinking about what you can do to ensure that your supply of deicers will meet your needs next winter whether it snows every two days or just two times the whole winter. If you rely solely on your source of supply to provide your deicers when you need them, then you are vulnerable to a disruption of supply if the weather is there. From the end user to the stockpile, everyone needs to accept that the best way to not get cut out of supply in a high demand condition, is to have a strong supply under your control and on hand. In a perfect world, you would not have any deicers on hand until the day before the storm – but that only works in an imaginary world. Typically, it takes up to two months to completely fill the bulk salt system one time. This allows for trucks to move at normal delivery schedules and the receiving party to schedule the delivery. Ships are scheduled to deliver as room becomes available when salt is taken from the stockpile to the salt sheds in their customers and end-users. Municipalities nearly all go out to bid for salt supplies and those bids typically begin opening in May and continue into the early fall. In this context, the supplier does not know what they are going to be obligated to supply under municipal contracts until fairly late in the summer. Because of this, they have to take pre-season estimates and then hope to balance their supplies and ship schedules after the total contract commitments are tallied up.
The only real answers are from the end user that is applying up to to the suppliers and wholesalers, everyone has to be willing to accept risk and buy and store product they may or may not need. This is typically all on the back of the supplier with private industry. Municipalities use contracts to ensure supply, and, they will usually have at least 3-5 storms of inventory in their salt sheds at all times. Private contractors almost never take that level of inventory and risk on a seasonal product.
The past five or so years have been very forgiving to the non-contract customers; they could order whenever they needed salt and it would arrive within a few days without incident. However, the frequency of storms in certain regions this past winter increased the velocity and demand beyond the inventory level and that’s when supply problems began. Thinking back to my earlier statement about transportation and the whole system will typically take many weeks if not months to completely fill, imagine how difficult it is try to do that again in just days.
For example, stockpiles in Port Newark, NJ were shut down this past winter because hundreds and hundreds of dump that trucks were waiting in line to load stretched out to the NJ turnpike and blocked critical travel arteries. The police could not allow the roads to be clogged up and blocked with empty trucks waiting in lines that were miles long to get loaded. This put a bad situation with supply into a really bad condition. It was already a holiday week with shortened workdays, and now one of three working days were ended because of the traffic congestion.
The snow contractor has to explain this to their customers and have the customers accept sharing the economic burden of carrying the deicer inventory locally or on their site and that may mean sharing the cost of the product and in the cost of a proper covered storage facility. Educate your customers to what happened and how to avoid it to engage them in the solution.
Prices will very likely rise this coming season (Winter 2021-22) because of big increases in costs of fuel, ocean shipping, and stockpiles. Renting waterfront storage locations is expensive in the areas of dense population. Expect your costs to rise and possibly more than might think.
Big trouble in ocean container shipping.
I’ve been warning of this for years and Winter 2020-21 conditions have finally broken the system. There are many factors that contribute to the problems but in simple terms for sea containers, the US brings in more containers than it sends out. China sends out way more than they bring in, so getting empties is difficult.
You need an empty container to fill with product in order to ship out, and if you don’t have an empty, you cannot ship your product. We are experiencing huge delays in ocean container shipping on a global scale with no end in sight. We import every week and some of our supplies are months behind and we do not have any product sourced in China. Many manufacturing facilities have had to shutter operations because critical supplies that were due by container have not arrived and are months or longer late. If you purchase products that are made in China, you can expect delays. Costs from China to the US west coast have increased fivefold for container shipments.
If the container is full of electronics or cell phones, they can likely pass along the increased costs. However, with most deicing products the freight costs alone from China to the US are now higher than the product price alone essentially eliminating that source. There may be some slight relief in bulk shipping but again, International Maritime Organization rules changes for sulfur stack gas emissions that went into effect January 1, 2020 have limited bulk vessels severely. Not a lot of options for importing that are affordable right now in commodities.
As I was writing this in late March, another global toilet paper shortage is expected due to shipping of wood fibers that are used to manufacture toilet paper are affected adversely by the worldwide container debacle, according to a recent Bloomberg report (CLICK HERE to read the entire article).
On top of that, a container ship broached and run aground blocking the Suez Canal. In just two days, 150 ships were anchored waiting to transit the Suez which was temporarily closed. Ten percent of all global traffic uses the Suez averaging 51 ships per day. So, this is going to have a significant trickle-down effect, and no industry is unaffected by this condition.
In summary, the best way to avoid disappointment with supply of road salt going forward is rely on your own inventory more and continually replenish that inventory back to the minimum level you feel is appropriate.
Keep at least 3-5 storms of deicers on hand at all times – even if it means you may have to carry that over the following summer until the next season. Buying early will usually provide deep discounts too so there is a silver lining in this approach.
Finally, be willing to sign a supply contract which will obligate you to a minimum purchase but will also ensure supplies are there when you need them if things get dicey with high demand.