MicroSalt shares soared in early trade on Wednesday after the food technology made a landmark announcement regarding the progress of its B2B business and partnerships with some of the world’s largest food manufacturing companies.
MicroSalt has announced game-changing orders and commitments for their low-sodium salt, including fresh orders for new product lines and repeat orders by a major food manufacturer.
MicroSalt’s New Initial Orders
In a statement released on Wednesday, the company said it had received an initial order for 50,000 lbs of their salt, equivalent to 22 metric tonnes.
The company has not revealed the specific products or customers, but the order size infers MicroSalt is now an integral part of a globally recognised product line.
“We are very excited to have received a significant new initial order for MicroSalt to replace traditional salt in a major product line, adding to product lines previously launched with a globally recognised customer,” said Rick Guiney, CEO of MicroSalt.
As a hypothetical example of the sheer scale of the new order, we ran the numbers using the salt content of crisps, one of the UK’s most loved snack foods.
A 25g packet of Walkers Ready Salted Crisps contains 0.34g of salt. A Sainsbury’s own brand 25g packet of prawn cocktail crisps contains 0.27g of salt while salt & vinegar crisps contain 0.40g.
If we take the average of these three crisp products, we can very roughly conclude that the average 25g packet of crisps has 0.33g of salt.
Should MicroSalt have sold the 50,000 lbs of salt to a crisp manufacturer, they would have enough salt to make over 68 million packets of crisps. To put that into context, the UK is estimated to consume 8 billion packets of crisps per year. And that’s by just 70 million in the UK.
We use crisps as an example because MicroSalt didn’t share the exact manufacturer or product, presumably because the food manufacturer who made the order wants to keep their solution to reducing sodium content in their products under wraps. MicroSalt has previously alluded to working with snack food companies, so crisps represent a sensible assumption.
The sale could have been to a bread manufacturer, a pretzel maker, or even a producer of microwave meals.
While we don’t know the exact end product or partner who made the order, we can reasonably assume whoever made the order is a serious food manufacturer.
Coincidentally, if the order were for bread rolls, the order would be enough to produce 36 million rolls, using the salt content of Waitrose floured baps as an example.
These are very rough assumptions and don’t consider any wastage during manufacturing or whether the same amount of MicroSalt salt and traditional salt is used.
That said, food manufacturers don’t make this sized order as a test, regardless of the end product.
The scale of the initial order, and the annualised projection, would suggest one of the world’s leading food manufacturers has reformulated one or more major lines to include MicroSalt, which is now ingrained in the manufacturing process.
MicroSalt has previously said it was engaged in testing with major food producers. Today’s announcement confirms these tests were successful.
If a major food manufacturer has reformulated a product line to include MicroSalt, they could work it into other products. If one major food manufacturer has included MicroSalt in their product, there’s a reasonable chance others will follow suit.
Today’s announcement provides evidence for this. MicroSalt’s Mexican partner is making repeat orders, and the firm’s low-sodium salt will soon be used in cereals, spice mixes, and energy bar products.
“Based on our ongoing discussions and the progress to date, we are also looking forward to the addition of Microsalt to other well-known product lines for this customer,” Guiney explained.
“Our progress within the spice and ingredient community as well as the successful efforts put forth at the SIAL event in Paris last week, is evidence that the hard work put in by the Microsalt team is bearing fruit globally.”
While the new initial orders demonstrate wider market adoption, news that one of MicroSalt’s first sizeable customers is continuing to purchase salt at an annualised rate of 640,000 lbs is probably the most significant takeaway from today’s announcement.
This is enough salt to supply multiple lines of the world’s most popular products.
MicroSalt shares have reacted accordingly, soaring over 40% in early trade.