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Salt at a pinch
Supply Management – 19 March 2009

It takes a lot of grit to keep the roads free of snow and ice. Mark Smulian looks at how some councils managed

When snow blanketed much of the UK in early February, getting hold of salt to de-ice roads became a difficult and very high-profile task. Councils found the stockpiles assembled to deal with a normal winter were running down at alarming speed. And their contractors had to lay hands on enough salt to keep at least their main roads open.

Procurement staff searched as far afield as Morocco, because salt is an industry with few UK suppliers.

Salt Union in Cheshire operates the largest salt mine. Nearby, British Salt is concerned mostly with the food market but sells some for road de-icing. There is also Cleveland Potash, based near Middlesbrough, and Irish Salt Mining and Exploration, at Carrickfergus, which supplies mainly Northern Ireland and Scotland. And that's it.

Contractor May Gurney procures salt as part of its highway maintenance contracts with the county councils of East Sussex, Essex, Northamptonshire and West Sussex.

Supply chain manager Richard Walsham says: "In normal times we manage salt supplies through framework contracts of five to seven years, the same length as our maintenance contracts, and use our judgement to replenish stocks from Salt Union and Cleveland Potash.

"But during the recent cold spell we had to import salt from Germany and a boatload from Morocco. "It is unusual to buy from that far away, but the Moroccan salt was competitive and the same product as we use, whereas other types of salt we could have bought required additional blending with granite grit or sand for the right consistency."

Some 1,600 tonnes came from German supplier Broste, a source found through aggregates supplier Dudman. "We have a good relationship with Dudman, who in turn has strong relations with Broste, which enabled us to get at the salt," Walsham says.

Essex and Northamptonshire were supplied by road as conditions allowed, but East and West Sussex were in a somewhat better position, despite some of the worst weather, because Cleveland Potash supplies them by sea to Shoreham harbour, which was not interrupted by adverse weather.

Stuart Smith, highways operations manager for West Sussex, says the costs of extra salt had to be met because lives were at risk had the county been unable to keep roads safe. Aside from the risk of fatalities the council could have faced legal proceedings from victims or their families.

"We normally do 46 salting runs in a winter and by the end of this one I expect it will be between 85 and 90," he says.

"Imports have cost us 85 a tonne, and it's normally 25, so it will be about 100,000 on top by the time we have finished. It might sound a lot but when you put a value on a life, it isn't. If we had missed runs there could have been accidents."

One relatively well-supplied council was Highland, which is used to severe winter conditions. Its salt is sourced from Northern Ireland and shipped to ports around the northern coasts.

Ashley Gould, head of procurement, says: "We had a reasonable stockpile and our salt is brought in by sea. "We run three-year tenders to have it delivered to quaysides and separate tenders for local haulers to take it to depots." Even so, Highland had used 77,000 tonnes by mid-February, against its normal 55,000, and had spent 4.2 million on salt compared with 3.7 million last year.

Joint procurement

To deal with the emergency, the Local Government Association, the Highways Agency, which handles trunk roads and motorways, and the Meteorological Office, formed the Salt Cell group to direct supplies to where they were most needed.

An LGA spokesman says: "Councils and the Highways Agency could ring round to see if they could buy or borrow supplies. "It worked best in London, the South West and North East where there seemed to be particularly good relationships."

The scarcity of salt suppliers might suggest that even in normal times there would be little competition in this market. But Walsham says: "We do get competitive bids. Some of that is down to different types of salt used for various situations, and some to transport costs."

Three-year tenders let by Highland have seen "always some competition. Even though it is a restricted market we have never had only a single bidder for any tender," Gould says.

Councils in both the East and West Midlands, together with the Eastern Shires Purchasing Organisation (ESPO), work jointly to buy salt as part of a wider collaboration on highways works. This project was driven forward by Warwickshire County Council in partnership with ESPO.

It has yielded savings of between 6 per cent and 17 per cent against previous tenders, with a total saving of 700,000 over a three-year contract. Salt was chosen as the first joint procurement because almost half the 24 councils happened to have contracts due for renewal last year.

Kevin Matthews, highways group buyer at the Eastern Shires Purchasing Organisation, says: "It is a suppliers' market and it is competitive. My view is that each supplier saw a large market here and felt either they supply it or they don't. "I was bulk-buying mainly one type of salt although there was also a demand for some varieties, such as a purer salt from Germany that Lincolnshire County Council needs because it uses different vehicles. "The contract is for two years, renewable for another two, and it is structured so that other local authorities could join it."

Varied specifications

There had been fears beforehand that this joint procurement would fail, either because specifications would be so varied that the advantages of aggregation were lost, or that the market would not respond given the paucity of suppliers. In the event there were five bids for the various salt types required.

Katie Moffat, communications officer for Salt Union, which normally mines some 30,000 tonnes a week, says the company's mine worked 24 hour days in February but prices did not increase since "all our supplies are on contracts agreed via tendering and run across a set period of years". She adds: "It is a slightly unusual market as no-one can open a new salt mine, but there are competitive tenders for each contract."

Salt is an oddity - possibly the only industry whose products get spread both on roads and dinner plates. Its suppliers are under heavy pressure from government healthy eating campaigns that seek to reduce the amount of salt going into processed foods. They will have been grateful for the extra business and increased public awareness of the industry that resulted from February's freeze.