The Road Salt Game: 2015-16 Winter
by Meteorologist Rob Guarino
June 7, 2015
Winter started off with a bang in parts of the Midwest and Great Lakes with above average snowfall and below average temps, just like we predicted in the winter outlooks. If you haven't already looked, beware of the sticker price per ton and start to manage your budget accordingly. I looked around and after a few calls the big salt suppliers in the Midwest and East Coast, it looks the average cost is $100 to $125 a ton heading into the winter.
The reason for the prices going sky high is a direct result of the record winter last year, not only on the East Coast, but the Midwest too. I call it the "double whammy" of winter. Most winters do not bring both regions record snowfalls but it did last winter and many places saw all-time record snowfall. Due to the alignment of the northern and southern Jet stream and the polar vortex the pattern allowed cold air and moisture to meet up throughout the entire winter. It dug further south than normal making for a continued phasing of both branches of the jet stream.
El Nino is the dominant weather pattern this year which brings warmer, wetter weather as opposed to the polar vortex. This will make for a yo-yo weather pattern and bring a variety of weather from region to region and month to month.
Last winter was also a long and cold winter with many locations getting 15-20 salting/snow events, rare indeed for any winter and record salt usage across North America. We also had winter last into late March in the East and into April in the Midwest, thus causing a delay in production heading into this fall.
HOW DO YOU PRICE YOUR SEASONAL ACCOUNTS?
So big decisions have to be made on seasonal accounts this winter that have fixed pricing because this could be the winter where you might take a big loss if you do not price your bids in the right direction. I have access to over 150 snow removal companies from Minnesota to Maryland and the theme I'm hearing is prices are high for salt and will not change this winter. This may not be true at all.
As a climatologist with over 30 years of professional forecasting experience in Philadelphia, Syracuse and other snow markets, I can tell you this winter will be up and down as far as temperature and storm frequency goes. With temperatures being half warm this winter the need for salt is going to be cut in half. If you have not bought all your salt yet, wait until the second half of winter when prices go down.
EL NINO COMETH!
I have been hammering home the El Nino push since May when the first big Kelvin wave out in the Pacific Ocean broke off into a few pieces and warmed up the Pacific like a pot of hot water on my mom's kitchen stove. It starting to put El Nino into premature labor before backing off in the later part of this Summer and now into early Fall. El Nino is now back but in a weak format and this could mean many changes in our weather pattern from week to week.
The waters are warm near Alaska, so warm that tuna and yellowtail have popped up from Baja California for the first time ever, so the fuel for the winter fire is there, oh it is for sure. The question becomes how cold will this winter actually be and will it phase with an El Nino pattern?
El Nino does not guarantee a snowy cold winter, but it does guaratee a winter of wild rides in temperatues and fast forming snowstorms. The Northern and Southern branches of the jet stream will snake up and down the U.S. coastlines this winter and this in turn will bring dry and snowless periods along with Cold and snowy flashbacks of last year's record winter.
HOW DO I PRICE MY SEASONAL FLAT RATE WINTER CLIENTS?
It depends on your location and criteria for plowing and salting. We see a few moderate to big storms in the Midwest and East.
As most of you know being in the snow removal business you have to approach every contract differently and it can vary from one town to the next and one client to the other. I look at this winter as the tale of two winters, almost a flip-flop of weather from the Midwest to the East. I see a fast, cold and snowy start to winter in the Midwest but a slow and dry ending. The East starts off mild and dry and ends up snowy and colder. My reasoning is in part to a delayed start to El Nino and it's West to East movement with the North Atlantic Oscillation and Eastern Pacific Oscillation.
The East will get most of its snow from the Sub tropical jet or Southern Jet stream as it phases with the North Polar Jet Stream January 15 to March 30th. It's the late bloomer El Nino that fuels that moisture rich southern jet to bring the bigger Nor'easters from North Carolina to Maine in the second half of the winter. The Midwest looks to be front end loaded with snow and backs off after January 15th.
The Midwest is coming off 9 straight months of below normal temps and the Great Lakes are already have a record start to the season in some places. Chicago recorded it's 3rd earliest snowfall ever and earliest in 70 years so we already see signs of that early Midwest start with the East soon to follow in December. Don't get used to this wintery start in the Midwest, The blow torch of warmer weather may be around the corner in 2015. If you are in the Midwest take the seasonal price fix accounts, you'll do just fine, In the East it's a break even with snowfall and temps about average for the winter ahead. Best of luck to all of you plowing and salting this winter.
MY SALTY PREDICTION
After looking over this split winter I see the prices of salt dropping during the second half of winter. All the big salt suppliers will see the East Coast plow pro's using below normal salt usage due to lack of snow and cold to start off the winter.
Sure the Midwest will get it's share of early snow and salting situations but without the double whammy of both regions getting hit the salt prices will drop and may drop quite a bit in January. Once the flip flop of winter changes the East Coast plow pro's will be ready and stocked from a slow start and the Midwest snow pushers will have survived the early winter storm, so to speak.
BUY NOW....BUT NOT ALL YOU NEED JUST YET
My advice to you? Whether you are in the Midwest or East buy a half season's of salt if you can in the coming 4-8 weeks. Let the slow start in the East allow for prices to fall in January and buy your next round after the new year. Happy buying and safe plowing into yet another profitable winter season.