(Roughly) Daily

Posts Tagged ‘salt

“Before the monopoly should be permitted, there must be reason to believe it will do some good – for society, and not just for monopoly holders”*…

From the ever-illuminating Matt Stoller (@matthewstoller), eagle-eyed sentinel against exploitative monopolies…

I write a lot about big tech, but today’s issue is about something so basic and fundamental we literally don’t think about it. Salt. Salt mining is one of humanities’ oldest industries, with wars fought over this commodity. Cities like Venice monopolized the salt trade in the middle ages for geopolitical reasons, and the British tried to block colonists from access to salt during the American Revolution to prevent their ability to preserve food. 

Today salt is still used in everything from chemicals to food preservation. Its main use is deicing our roads, because salt from mines across North America, and shipped in from overseas, makes it possible to drive in all sorts of weather. Salt saves lives, stops car accidents, and makes our economy run. 

And in the U.S. and Canada, salt mining is being monopolized, as we speak…

In the winter, when it’s really cold and snowy, what Americans need is not a competitive semiconductor industry or better app stores. They need salt. And not the kind of salt that flavors our food, but the kind that melts snow and ice. If we don’t have salt, no one can drive, because salt is what keeps our roads manageable. Without salt, trucks can’t deliver supplies, people can’t get to stores or work, and the economy comes to a standstill. 

And people die. A lot of them.

Every year, over 1300 people die in car accidents due to snowy, slushy, or icy pavement, with another 117,000 injured. Snowy weather is also a huge waste of time and money, costing roughly $500M a day, and 544 million vehicle-hours a year of delay. Road salt doesn’t eliminate this problem entirely, but it comes close, reducing collisions by up to 88% and injuries by 85%. Studies show that deicing salt pays for itself within the first 25 minutes after it is spread. Roughly 40% of domestic salt, produced largely from mining, is used not for food or chemicals, but for deicing. It’s a major expense for cities and states, and commercial customers like shopping malls. And because weather leads to demand spikes, and America tends to operate in just-in-time style inventory models instead of managing risk by storing surpluses of critical commodities, there are often shortages of road salt precisely when everyone needs it most.

And that’s why I paid attention when ex-convict and junk bond king Michael Milken’s alleged private equity firm, Stone Canyon, bought two major salt producers over the last year. Early in 2020, Stone Canyon acquired Kissner, a producer of deicing salt, private label consumer salt, and salt-related chemicals. Then, nine months later, Stone Canyon bought Morton’s Salt, the largest producer in the world, for $3.2 billion, and it is now awaiting antitrust approval. Kissner is itself a roll-up of the salt industry, having bought Central Salt and Lion Salt and turned itself from a small Ontario-based regional distributor of ice melt into one of the giants of the industry. So Stone Canyon is overseeing a roll-up of roll-ups.

This series of mergers should terrify cities across the upper Midwest, who have to buy salt in unpredictable spot markets and often deal with shortages when the weather gets bad. Minnesota, for instance, bought roughly 1.5 million tons of salt for the 2020 season. Salt is a regional business, it’s just not economical to move extremely bulky road salt over land more than 150 miles, so while port cities can get salt from abroad in ocean vessels, and salt can be barged up the Mississippi river, much of the upper Midwest and Canada has to buy local. (It doesn’t help that America’s rail system is monopolized.)…

The salt industry is an oligopoly, and the number of suppliers to Governments in regions of the Great Lakes markets will shrink from 4 to 3 and in some geographies from 3 suppliers to 2. There are two consequences of this consolidation of salt production. The first is that prices will go up, and municipal budgets will be stretched. 

Salt is sold in blind bidding processes. Governments put out tender offers, and then suppliers bid. When bidding, suppliers will set prices by considering the supply levels among competitors. If there are only two competitors in a market and one of them has committed their salt production for the year, then the remaining one is a monopolist who can just set the price. This is particularly true for a bunch of Midwestern states, like Michigan, Ohio, Indiana, Illinois, Wisconsin, and Minnesota.

But the much more serious problem is that of shortages. The industry manages demand spikes from weather not by having spare production capacity or lots of storage, but by overpromising salt deliveries. The rule of thumb is that one out of every five years will see a mild winter with few sales, three out of five will be snowy but normal, and one out of five will involve extreme weather and much higher demand. Of course, rules of thumb have gone out of the window now that there’s more extreme weather, which means demand drops and spikes will be more common. 

One of the best ways of winning market share is to bid low, and then if demand is high, to simply not deliver to Commercial customers (Landscapers that service residential and commercial customers are almost always shafted first, meaning driveways and sidewalks go unsalted.) There are penalties in contracts for doing this to government customers, but when the snow hits, it doesn’t matter and the producers often pay the penalties if they are even enforced by the government entities. All customers need the salt when it snows, and a contract dispute doesn’t get in the way. 

It’s quite possible, and indeed likely, that shortages will worsen. Without competition, it will be much harder to go to a different supplier, because there won’t be any other suppliers. And private equity takeovers in general are operational nightmares, which means that it’s likely Kissner and Morton will have problems with production and distribution purely because mergers tend not to work out. 

There’s one final piece of the problem. Because private equity firms have too much money and not enough acquisition targets, prices for mid-market industrial companies are really high. So Stone Canyon almost certainly overpaid for both Kissner and Morton’s. To justify its investment, Stone Canyon is going to have to cut costs and reduce capital spending, which will harm production, because salt mining needs a lot of investment. Then it will likely have to raise prices. In other words, if the merger goes through, the financial pressure of paying such rich prices for salt firms will force significant price hikes, and potentially shortages in the market… 

A private-equity salt roll-up suggests that we’re in for shortages and price spikes: “How a Salt Monopoly Could Spike Car Accidents in the Midwest,” eminently worth reading in full.

For other reasons to be paying attention to salt: “How America got addicted to road salt — and why it’s become a problem.”

* Lawrence Lessig

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As we study saline substitutions, we might recall that it was on this date in 37 CE, following the death of Tiberius, that the Roman Senate annulled Tiberius’ will and confirmed Caligula, his grandnephew, the third Roman emperor.  (Tiberius had willed that the reign should be shared by his nephew [and adopted son] Germanicus and Germanicus’ son, Caligula.)

While he has been remembered as the poster boy for profligacy, Caligula (“Little Boots”) is generally agreed to have been a temperate ruler through the first six months of his reign.  His excesses after that– cruelty, extravagance, sexual perversity– are “known” to us via sources increasingly called into question.

Still, historians agree that Caligula did work hard to increase the unconstrained personal power of the emperor at the expense of the countervailing Principate; and he oversaw the construction of notoriously luxurious dwellings for himself.  In 41 CE, members of the Roman Senate and of Caligula’s household attempted a coup to restore the Republic.  They enlisted the Praetorian Guard, who killed Caligula– the first Roman Emperor to be assassinated (Julius Caesar was assassinated, but was Dictator, not Emperor).  In the event, the Praetorians thwarted the Republican dream by appointing (and supporting) Caligula’s uncle Claudius the next Emperor.

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Written by (Roughly) Daily

March 18, 2021 at 1:01 am

“Arguably the greatest technological triumph of the century has been the public-health system”*…

 

The car seat: one of the objects that shaped public health

Public health impacts all of us, in every corner of the globe, every day of our lives — not only our health and safety, but also how we live, what we wear, what we eat, what happens to our environment and the stewardship of our planet. For better or worse, these 100 objects have made their mark on public health. Some, such as vaccines, have helped keep us healthy. Others, including cigarettes, have made us sick. Some are surprising (horseshoe crabs?) and others make perfect sense (bicycle helmet). Some are relics from the past (spittoon) and others are products of our digital age (smartphone)…

In celebration of its centennial, the Johns Hopkins Bloomberg School of Public Health has compiled a list of the “100 Objects That Shaped Public Health.”

* “Arguably the greatest technological triumph of the century has been the public-health system, which is sophisticated preventive and investigative medicine organized around mostly low- and medium-tech equipment; … fully half of us are alive today because of the improvements.”
― Richard Rhodes, Visions of Technology: A Century of Vital Debate About Machines Systems and the Human World

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As we buckle our seat belts, we might send thoughtfully-seasoned birthday greetings to David Marine; he was born on this date in 1888.  A pathologist, he is best remembered for his trial, from 1917 to 1922, during which he supplemented the diets of Ohio schoolgirls with iodine, which greatly reduced their development of goiter— and led to the iodization of table salt (one of Johns Hopkins’ 100 Objects).

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Written by (Roughly) Daily

September 20, 2016 at 1:01 am

Salt of the Earth…

What’s going to become of health-care in the U.S. in the wake of partial “reform” and evaporating public funding, is anyone’s guess.  What’s more certain is that it’s prudent for one to take good care of oneself– to stay out of the system…

The Mayo Clinic reminds us that the 2010 Dietary Guidelines for Americans recommend limiting sodium to less than 2,300 mg a day — or 1,500 mg for those age 51 or older, or African-Americans, or those with high blood pressure, diabetes or chronic kidney disease.

But the average American takes in about 3,400 milligrams of sodium every day.  And studies suggest that a high-sodium diet is linked to a host of ailments, including high blood pressure, stroke, osteoporosis, and exercise-induced asthma.

So it’s bracing (if not indeed shocking) to consider the salt content of restaurant meals…

P.F. Chang’s Double Pan-Fried Noodles with Pork

7,900 milligrams sodium
1,652 calories
84 g fat (12 g saturated)

Sodium Equivalent = 23 Slabs of Hormel Canadian Style Bacon
Here are a few things with less salt than these sodium-sunk nefarious noodles: 239 Saltine crackers, 153 cups of Newman’s Butter popcorn, and 22 orders of McDonald’s large French fries…

Chili’s Fajita Quesadillas Beef With Rice and Beans, 4 flour tortillas, and condiments

6,390 milligrams sodium
2,240 calories
92 g fat (43.5 g saturated)
253 g carbohydrates

Sodium Equivalent = 194 Saltine Crackers
This confounding creation delivers nearly a dozen Krispy Kreme original glazed doughnuts worth of calories, the sodium equivalent of 194 saltine crackers, and the saturated fat equivalent of 44 strips of bacon…

Applebee’s Weight Watchers Chipotle Lime Chicken

4,990 mg sodium
490 calories
12 g fat (2 g saturated)

Sodium Equivalent = 31 servings of Ruffles (that’s more than two “Family Size” bags!)
Avoiding salt at Applebee’s is nearly impossible. Not even the “healthy” selections pass muster. The six items on the Under 550 Calories menu average 2,341 mg of sodium per entree. The five items on the Weight Watchers menu average 2,448 mg…

27 other meals-to-miss at Eat This, Not That’s “30 Saltiest Foods in America.”

As we insist on at least two colors (not counting ketchup) on our plates, we might wish a juicy Happy Birthday to actress Shanelle Workman (Gray); she was born on this date in 1978.  While she’s probably most widely recognized for her role as Sarah “Flash” Roberts on the ABC soap opera One Life to Live (2003 and 2004), she is probably most widely heard as the voice of “Wendy” in commercials for the fast food chain.

Shanelle Workman Gray (source)

 

And they say that salt is bad for one’s heath…

In news likely to unsettle “young earthers”– the plurality of Americans who believe that the earth, and life on it, were created by God all at once about 10,000 years ago– scientists have discovered 34,000-year-old organisms…

It’s a tale that has all the trappings of a cult 1960s sci-fi movie: Scientists bring back ancient salt crystals, dug up from deep below Death Valley for climate research. The sparkling crystals are carefully packed away until, years later, a young, unknown researcher takes a second look at the 34,000-year-old crystals and discovers, trapped inside, something strange. Something … alive.

Thankfully this story doesn’t end with the destruction of the human race, but with a satisfied scientist finishing his Ph.D.

“It was actually a very big surprise to me,” said Brian Schubert, who discovered ancient bacteria living within tiny, fluid-filled chambers inside the salt crystals.

Salt crystals grow very quickly, imprisoning whatever happens to be floating — or living — nearby inside tiny bubbles just a few microns across, akin to naturally made, miniature snow-globes.

“It’s permanently sealed inside the salt, like little time capsules,” said Tim Lowenstein, a professor in the geology department at Binghamton University and Schubert’s advisor at the time…

The key to the microbes’ millennia-long survival may be their fellow captives — algae, of a group called Dunaliella.

“The most exciting part to me was when we were able to identify the Dunaliella cells in there,” Schubert said, “because there were hints that could be a food source.”

With the discovery of a potential energy source trapped alongside the bacteria, it has begun to emerge that, like an outlandish Dr. Seuss invention (hello, Who-ville), these tiny chambers could house entire, microscopic ecosystems…

The bacteria are the tiny, pin-prick-looking objects, dwarfed by the larger, spherical algal cells. The colored spots come from pigments the algae produce, carotenoids, still vibrant 30,000 years on.

Read the story in its entirety at OurAmazingPlanet.com; and read Shubert’s paper in the January 2011 issue of the journal of the Geological Society of America, GSA Today.

As we ponder the prospect of seasoning our popcorn, we might recall that it was on this date in 1809 that the first U.S. geology book of importance was read by William MacLure, a Scot who’d immigrated to the U.S. ten years earlier, before the American Philosophical Society at Philadelphia, Pa.  Observations on the Geology of the United States, which was published in revised form in 1817 and contained the first chart of United States territory that divided the land into rock types, was the first true geological map of any part of North America and one of the world’s earliest geological maps. (MacLure’s reading predated William Smith’s first geological map of England by six years.)

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Salting it away…

Medical authorities recommend that adults consume no more than 2,300 mg of sodium per day–  about 1,000 mg less than the average American actually ingests– lest one suffer high blood pressure, stroke, osteoporosis, and/or exercise-induced asthma.

From the folks at Rodale and Men’s Health, a cautionary guide to restaurant entrees across our heavily-salted nation: “30 Saltiest Foods in America.”  Number 1?  An offering that’s no slouch when it comes to calories and fat content, but that is an undisputed champion in the sodium sweepstakes:

P.F. Chang’s Wok Charred Beef
10,045 milligrams sodium
850 calories
30 g fat (15 g saturated)

Sodium Equivalent = 31 Slabs of Hormel Canadian Style Bacon
Here are a few things with less salt than this sodium-sunk beef blowout: 244 Saltine crackers, 40 bags of Funyuns, 175 cups of Newman’s Butter popcorn, and 28 orders of McDonald’s large French fries.

As we aspire to life above the salt, we might recall that it was on this date in 1910 that Alice B. Toklas moved in with– and became the life-long house mate of– Gertrude Stein.  Together, they turned their Parisian home at 22 rue de Fleurus into an artistic and literary salon, where they entertained Picasso, Matisse, Hemingway, and Fitzgerald, among many others.

Toklas and Stein in the Piazza San Marco, Venice  (source: Beinecke Library, Yale)

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