The weather in Chicagoland over the last week has been miserable. I have shoveled the walks way too many times and it now feels like we’ve been transported to Hoth. That has gotten me thinking about road salt. That and a New Yorker article on the Atlantic Salt’s operations on Staten Island (The Mountain, Dec 23). The mountain referenced in the article’s title is a giant pile of salt — a third of a mile long and four stories high. It’s big enough to see on Google Earth. Check out the multicolored tarps.
In any event, managing the inventory of road salt is an interesting challenge. When you need it, you got to have it. As a company rep says in the article, they have a “public-safety responsibility never to run out.” But you never know exactly how much salt you will need. And, of course, having inventory is expensive. Salt costs around $59 a ton and those tarps are covering about 200,000 tons. That starts to add up. Further, Staten Island may not be midtown Manhattan but real estate in New York still ain’t cheap.
Now you might think that expensive inventory and limit storage space would favor having a proximate, responsive supplier but that is not the case here. Chilean salt is what keeps New Yorkers from slipping.
Almost all of the Road salt used in New York City arrives by sea. Upstate New York has huge underground deposits of salt, but moving it hundreds of miles by train is much more expensive than transporting the same amount thousands of mile by ship.
Getting salt from South America takes about three weeks and the lead time is uncertain because of sea conditions and congestion at the Panama Canal.
I’ve been trying to posit just what tradeoffs would make it more economical to import salt from far away instead of using a more or less local supply. I can see a couple of factors. First, the price difference would not have to be too substantial to favor the Chilean salt if Atlantic Salt is using enough of the stuff. That is, a dollar a ton differential may make a longer lead time and more inventory worthwhile if they are spreading millions of tons of the stuff a year around the streets of New York.
A second consideration could be that the lead time difference may be more significant than mere geography would suggest. Actually getting a train into the city proper (or at least an outer borough) isn’t easy. So getting Upstate salt onto a train to get it kinda close to the city and then having to truck it the last stretch involves not only cost but also time.