Just two weeks into winter, Jeffrey Gartz, owner of American Snow Removal Inc. and Perfect Sweep Inc., both in Toledo, already has used 20 percent of his supply of rock salt. He paid almost $1 million up front to secure 10,000 tons of rock salt. 'I've been in this business 30 years, and I've never seen anything like this,' Mr. Gartz said.
In a stormy economy, one group of company managers is watching profits melt away.
The skyrocketing costs of rock salt is sending an icy chill though the folks responsible for keeping parking lots and sidewalks clean and safe at shopping centers, apartments, pizzerias, and other businesses.
"It's astronomical," said Pam Dickens, of the Building Owners and Managers Association of Toledo.
Many firms are paying twice as much for rock salt this year as last, she said.
The problem is that, although rock salt is made from an abundant mineral called halite, production capacity has been taxed by severe winter weather the past two years, experts said.
After prices soared last year from $42 a ton, including delivery, to $160 when stockpiles dwindled, many wholesale buyers were determined not to get caught short again. Some cities and commercial customers bought two or three times as much salt as usual, helping create this year's shortage, experts said.
And the weather locally isn't cooperating either. With winter just two weeks old, northwest Ohio and southeast Michigan have had more ice than normal, building executives complained.
At the retail level, prices are up only slightly.
A 50-pound bag of rock salt sells for $5.12 at The Andersons General Store, Maumee. That's about 4 percent more than last year, clerk Marty Hunter said. The store has ample supplies, although it has been unable to get the 25-pound and 80-pound bags usually stocked.
It's a different story on the commercial side of the business.
As of last week, Jeffrey Gartz, owner of a Toledo snow-removal business, had used 20 percent of his supply.
"I've been in this business 30 years, and I've never seen anything like this," said Mr. Gartz, owner of Perfect Sweep Inc. and American Snow Removal Inc.
Determined to have adequate supplies, he paid almost $1 million up front to lock up 10,000 tons of salt he expects to need to satisfy customers who operate shopping centers, apartments, and other businesses in the Toledo area.
Current prices are about $76 a ton, or 81 percent more than at the start of last winter, he said.
Mr. Gartz has had no alternative but to pass the price increase on to customers.
That means that some businesses with large lots are paying $600 in salting costs each time the flakes fly and ice forms. "It's now gotten to the point where salting is more expensive than the plowing in a lot of cases," he said.
Giammarco Properties, which owns shopping centers and Marco's Pizza franchises in the Toledo area, largely has switched from rock salt to an alternative material for ice-melting, said Fred Bollinger, facilities manager. The product is less corrosive on pavement than rock salt, he explained.
But like rock salt, the cost of the ice-melter also climbed. A 50-pound bag is $10.40, up 16 percent from last year.
Mr. Bollinger spent $2,000 on a supply that he hopes will get him through winter. He'll spend additional funds to buy rock salt, which is used for about 20 percent of the firm's ice-melting needs.
Kuhlman Corp., Toledo, is a major supplier of rock salt to snow-removal services and other customers. The firm ships the product by water to Toledo from mines in Cleveland, Detroit, and southwest Ontario.
Demand is high this year, partly because about 30 firms that are accustomed to buying rock salt directly from salt companies were unable to do so and had to turn to Kuhlman, said Steve Smigelski, general manager of the firm's bulk materials division. Salt companies had their hands full supplying municipalities and highway authorities, he explained.
By Dec. 31, Kuhlman had shipped about 75 percent of the 108,000 tons of salt it purchased.
Mr. Smigelski hopes that prices will ease, but isn't encouraged by recent rough weather. "If we continue to go at the rate we are now, this isn't going to get better," he said.
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