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Will US Storms Lead to Salt Shortage?

LONDON, January 13, 2014 /PRNewswire/ --


With large snow storms hitting the USA in January 2014, salt demand is peaking and some municipalities already fear a lack of supply. For instance in Springfield (Montana), officials announced in January that stocks of salt were low and salt suppliers were running out of inventory.  Officials said they had used more salt during the first storm of 2014 than they did during the entirety of last winter. Other municipalities in Pennsylvania have reported de-icing salt shortages as salt suppliers, ironically, could not deliver their loads as the roads were too icy for the trucks.  

Is this situation as bad as it sounds? Most cities and states are reassuring their citizens that salt supply will be sufficient for the rest of the winter.  Significant salt stockpiles they have built-up over the two last years will support supply combined with American salt producers running at high operating rates.

It is interesting that for many years, US producers have never supplied the whole domestic de-icing demand. The USA is the largest salt importer in the world with an average of almost 12Mtpy of salt imported between 2003 and 2013. Annual imports vary greatly (by as much as 60%py) mainly depending on winter conditions. Canada is the leading source with almost 40% of total imports, closely followed by Chile with around one third. US imports fell to under 10Mt in 2012, their lowest level since 2007. From January to November 2013, imports recovered to over 11Mt and might reach above 12Mt by the end of the year thanks to large volumes shipped from Canada, Chile and increasingly Mexico.

In its own backyard, the USA is the second-largest producer of salt worldwide after China, accounting for an estimated 15% of world output in 2013.  Salt in de-icing accounts for around 13%-17% of global consumption but in the USA it represents 37-42%.  US salt production and sales show annual fluctuations due to weather conditions.  For instance, domestic salt production peaked at 53Mt in 2008 following very cold conditions but fell to an estimated 40Mt in 2012 following a very mild winter.

US salt output is estimated to have recovered to 43-44Mt in 2013.  The first three quarters of the year were already showing a good recovery from 2012 levels.  North America winter weather was more "typical" and sales volumes for de-icing salt were above average compared to the previous year.

For instance K+S, which owns Morton Salt (the second largest domestic producer), sold 52% more de-icing salt during the first nine months of 2013 than during the same period in 2012.  Compass Minerals (the third largest salt producer in the USA) also saw its sales grow, increasing by 31% during the same period.  The company's highway de-icing business sold 4Mt in the three months ended December 2013 alone compared with 2.3Mt in the Q4 2012.

According to Compass Minerals, this winter will help price increases after two lean seasons. The price recovery is also influenced by a large inventory built-up during the last two mild winters, which is being reduced by robust demand.  American Rock Salt, the largest operating salt mine in the USA based in the New York State, has recently recruited more miners to support increased production of salt. The company said it was a very good winter for its business

If winter conditions remain the same, salt shortages might occur in a few municipalities. However, most states will be able to use their large stockpiles from the two previous mild winters, as well as new supply from American producers and from imports. This cold winter will not only provide a warm feeling for domestic salt producers but also for foreign operations based in Canada, Chile and Mexico.

Salt: Global Industry Markets & Outlook  is available, until the 31st JAnuary, at an introductory price of £3,527 / US$5,440 / €4,165 from Roskill Information Services Ltd, 54 Russell Road, London SW19 1QL ENGLAND. Tel: +44-20-8417-0087. Fax +44-20-8417-1308 Email: info@roskill.co.uk Web: http://www.roskill.com/salt

Note to editors

Roskill Information Services Ltd. of London, UK is a leading provider of multi-client and bespoke market research services to the minerals and metals industry.

For further information on this report, please contact Alison Saxby, asaxby@roskill.co.uk or +44-20-8417-0087.


SOURCE Roskill Information Services

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