Infrastructure

John Phipps: Why Can't the U.S. Figure Out a Way to Move Water From the Great Lakes to the West?

Thu, 21 Jul 2022 13:48:05 GMT

Regular viewer Eric Smassanow asks a question that pops up from often during droughts:

“Why has the government never taken action besides Lake Mead to move water around the country like we do energy? Seems like there are many times pumping water west from the east would help both regions.”

As the western US continues to suffer a 22-year megadrought, it is hard not to look at a map and zero in on the Great Lakes as the obvious solution. All we need to do is pump some of that excess fresh water west – like this idea from William Shatner to pump Lake Superior water to the Green River and on to Lake Mead. After all the Great Lakes are one of the largest sources of fresh water in the world.

This idea faces some huge hurdles.

California alone uses the same amount of water as the entire Red River flow. Even supplying a fraction of that would take pipes beyond imagination. Canals would suffer enormous evaporative loss. The water would have to be pumped over the Rocky Mountains – a roughly 6000 foot lift.

Could Rail Workers Now Strike Starting Monday As Concerns Of a Feed Shortage Continue In the West?

Thu, 14 Jul 2022 20:42:19 GMT

Continued issues shipping feed and other products via rail are growing more severe. Feed users already report being just days away from running out of feed, and as labor negotiations continue between the railroads and unions, a weekend deadline looms to keep the collective bargaining process on track.

President Joe Biden has until Sunday, July 17, to appoint a Presidential Emergency Board (PEB) to investigate and make recommendations for settlement. If the Sunday deadline isn’t met, rail labor has already voted to go on strike. However, the Association of American Railroads told AgWeb on Wednesday that it’s widely expected there will be an appointment of a PEB by the deadline.

As first reported last month, rail bottlenecks in the U.S. are not improving for those in need of grain in the West. Feed users in California and the Southwest are having issues sourcing grain, with some reporting they are paying $3 over the CBOT price to secure grain by truck. Not only are feed users on the brink of running out of grain, but there are also concerns the rail issues could grow worse during harvest this fall.

Looming Rail Strike?

The labor negotiations, which cover 115,000 workers according to Reuters, has been in what they call a 30-day cooling off period. The White House has until Sunday, July 17, to appoint a PEB.

Sources in the grain industry say if President Biden doesn’t appoint the PEB, then railroad labor is authorized to strike. The decision to go on strike is already in motion, as rail labor already voted to strike on Monday in the event Biden does not appoint a PEB.

A White House official is quoted as saying the administration “is going through the standard process that has been used in the past when considering a PEB.”

A strike isn’t inevitable, as the AAR says it is widely expected that there will be an appointment of a PEB. The AAR says it’s important to note there there are a number of steps left before a work stoppage would even be possible under the law.

The Issue in Storing and Transporting Grain

Eric Wilkey, president of Arizona Grain, Inc., saw the issues starting firsthand this spring. Rail cars that were scheduled to arrive in May, as area wheat harvest was gearing up, didn’t actually start arriving until early July. As a result, wheat supplies piled up at their facilities.

“Now, they’ve [railroads] signaled to us in meetings publicly and otherwise, that they are having some success in hiring again and getting crews successfully through training,” he says. “For us, there’s no time as we’re in harvest right now. And I don’t have time to wait another three months for crews to be trained.”

Just prior to the STB hearing in April, Landus Coop, representing 7,000 farmer owners in Iowa, submitted written testimony saying rail issues meant they were only able to load half the rate of shipments necessary, and the backlog meant farmers trying to haul grain to the coop were being turned away.

“If this slow down continues at this rate we risk not having space for the 2022 harvest for our 7,000 farmer members by an estimated total bushels of 15,750,000! The market impact of the additional cost of other freight shortages and an inverse grain market add considerable risk and uncertainty in our business. This comes at a time when we are also experiencing the strain of trucking shortages. The impact of these delays is compounding and causing increasing concern the closer we get to harvest season,” the letter stated.

Landus also said if the situation is not resolved quickly, the industry risks:

- The potential for livestock producers in California and other states potentially running out of feed.

- Ethanol plants and soybean crush facilities potentially not having the ability to ship product.

- Farmers unable to deliver old crop grain to elevators or ethanol plants, which will place enormous pressure on harvest success this fall, further disrupting the food and fuel supply chains in the months ahead.

- U.S. grain exporters will be not be positioned favorably to compete in global marketplace.

Foster Farms, the largest chicken producer in the western U.S., asked federal regulators to issue an emergency service order last week that would direct Union Pacific to prioritize corn shipments that thousands of dairy cattle and millions of chickens and turkeys depend upon.

”The point has been reached when millions of chickens will be killed and other livestock will suffer because of UP’s service failures,” Foster Farms wrote in its request to the Surface Transportation Board in June.

Livestock Producers Report Being Just Days Away From Running Out of Feed Due to Shipping Rail Issues

Tue, 12 Jul 2022 20:46:53 GMT

Rail bottlenecks in the U.S. are not improving, and in some cases, growing more severe. Feed users in California and the Southwest are having issues sourcing grain, with some reporting they are paying $3 over the CBOT price to secure grain by truck. Not only are feed users on the brink of running out of grain, but there are also concerns the rail issues could grow worse during harvest this fall.

The National Grain and Feed Association (NGFA) says their members have been seeing issues since late winter and early spring, which then caused the Surface Transportation Board (STB) to hold a hearing in August. While the industry thought the issues would improve by summer, labor issues are not getting better.

“What I’m hearing from our members is fewer equipment issues and that the equipment and engines seem to be not breaking down, but the train times - the amount of time it’s taking to get the trains - and the reliability of receiving them is still quite a problem in in quite a few areas of the country,” says Mike Seyfert, President and CEO of NGFA.

Fears of Running Out of Feed

According to Trains.com , Foster Farms, the largest chicken producer in the western U.S., asked federal regulators to issue an emergency service order last week that would direct Union Pacific to prioritize corn shipments that thousands of dairy cattle and millions of chickens and turkeys depend upon.

”The point has been reached when millions of chickens will be killed and other livestock will suffer because of UP’s service failures,” Foster Farms wrote in its request to the Surface Transportation Board this week .

Seyfert says the emergency order shows the seriousness of the issue.

“At times in in the past several months, we have heard from more than one member that has had severe difficulty getting feed, sometimes being within several hours of being short,” says Seyfert.

While a combination of weather, supply chain issues and other factors are creating the severe scenario, the main issue seems to revolve around labor. According to NGFA, railroads were already down about 25% in staffing prior to the COVID-19 pandemic. Then, problems during the pandemic only exacerbated the labor issue.

Ken Erikson, senior vice president at S&P Global Fuels, Chemicals and Resource Solutions Group, says the training required to bring employees back on the railroad is something that takes time, similar to what airlines are experiencing with pilots and other staff.

“The railroads had on a mandated requirement, instituted position railroad systems out there for precision scheduled railroads, part of the requirements to meet for the federal government,” says Erkison. “So, they thought they didn’t need as much crews if they can automate some things or be able to have greater visibility and trains. Well, the reality is they got so far behind they had furloughed a lot of crew members. And you just can’t bring crews back overnight without adequate training and to bring equipment back that’s offline to get a condition again. These things take long lead times.”

Congress Urges STB to Take Action

This week, 51 members of the U.S. House of Representatives signed a letter and sent to the STB regarding issues with the rail system in the U.S.. The letter asked STB to continue to work through the current rail issues with all stakeholders in order to address short-term challenges and find a resolution.

“On behalf of our constituents and farmers around the country, we write regarding poor rail service, which has limited fertilizer shipments, among other essential agricultural inputs and commodities, including grain and feed,” the letter stated.

“At a time when global fertilizer supplies and global crop production are highly disrupted, imposing shipping curtailments on fertilizer inputs and grain, as recently proposed by Union Pacific, will cause major supply chain disruptions, hurt American farmers, and exacerbate the food crisis considerably. We must ensure critical commodities reach essential industries and workers, such as America’s farmers, who are essential to feeding our nation and the world. Food is a national security issue, and we must treat it as such,” the 51 members wrote in the letter.

The Senate sent a similar letter to the STB in May.

More Issues Due to Labor Discussions/Disputes?

Another issue with labor are union and other labor discussions and disputes. Erikson points out the International Longshore and Warehouse Contract with Pacific Maritime Association expires Friday, July 1. Erikson says the two parties have been negotiating and committed to stay working, there could be other ripple effects.

“They’ve committed to stay working, but what we’ve seen as the diversion of cargo moving to the West Coast or to the U.S. Center Gulf, areas that move a lot of cargo, but also you have requirements and equipment demand to other regions that hasn’t been there. So now you move the problem elsewhere,” says Erikson.

Ahead of Friday’s expiration, the L.A. port chief sees no disruptions on eve of contract lapsing. Farm Journal Washington correspondent Jim Wiesemeyer reports the head of the US’ busiest port said he doesn’t foresee strikes at about 30 West Coast maritime hubs even as the labor contract for 22,000 dockworkers is about to lapse without a new deal. “Anything’s possible, but it will not happen,” Port of Los Angeles Executive Director Gene Seroka said Wednesday.

The labor issues could be far from over, as the four major rail lines are in the middle of a labor dispute with the unions. With the timeline on the table today, there are concerns those issue could grow more severe and possibly cause even more rail issues during the fall months, which is a busy time with harvest.

“They’re currently in a 30 day cooling off period, where they’re no longer working on arbitration,” Seyfert explains. “There’s some actions the President can take in mid-July to appoint a board, which can then make some recommendations that can be acted on. There’s 30 days there. Then, there’s 30 days for the railroads and in the labor to work together to determine to accept or not accept that.

Once we get into mid-September, there’s also a risk of some labor issues, even labor stoppage on some of the rail lines. And so getting these things addressed now and all of us working together before we get particularly into that fall harvest, where we’ve really never been in a situation where a reliable and resilient rail service is more important than it is.”

Seyfert says there have been recommendations made to the Surface Transportation Board (STB) regarding more transparent reporting by the railroad, as well as a request for railroads to submit service plans. There are also additional steps Congress could take to help resolve a portion of the rail bottlenecks.

President Biden likely to address War, Food and Fuel Costs, Ocean Shipping Reform

Tue, 01 Mar 2022 22:26:27 GMT

President Joe Biden will give his first State of the Union address Tuesday evening, and it likely won’t be the speech he and his staff had anticipated giving even a week ago.

USDA Secretary Tom Vilsack said it will be a difficult address for Biden to give because of Russia’s invasion of Ukraine.

“Our thoughts and prayers are extended to those brave people (in Ukraine) who are fighting fiercely against the bully that’s trying to take over their country,” Vilsack said during a discussion with AgriTalk Host Chip Flory on Tuesday afternoon.

Earlier on Tuesday, Biden authorized a decision to release 30 million barrels of oil from the Strategic Petroleum Reserve. Much of that decision, Vilsack said, was in response to the war in the Ukraine. However, the decision also was made in part to try and address the prices Americans are paying for fuel.

“There’s no question the president is cognizant of the higher prices American farmers and families are paying right now at the pump,” Vilsack said.

He also referenced Biden’s decision to authorize the USDA to provide assistance to the biofuel industry and expand the infrastructure for higher blends as an effort to stem higher fuel prices.

“Remember, we’re putting $100 million dollars on the table for E15 expansion and higher blends in the country,” Vilsack said. “It’s why (Biden) basically signed off on the EPA providing record levels of biofuels in 2022. Whether it’s in the speech tonight or not, let’s just make sure we look at the entire picture here, because it’s a pretty significant one.”

When Flory asked whether the president would address the Department of Justice’s investigation into the meatpacking industry and cattle market prices tonight, Vilsack demurred.

“You know, that’s being pretty closely held, as all investigations are,” he told Flory.

Broad-Ranging Topics

Additional topics Biden is likely to address in the State of the Union range from climate change to infrastructure improvements, health care, and child-care costs.

Vilsack reminded AgriTalk listeners that the U.S. has had a growing economy in the past year. “We’ve had the fastest job growth in history; we’ve had the fastest economic growth of the country in 40 years. Let’s not forget that,” he said.

When Flory asked whether there will be any surprises in the speech, Vilsack replied, “Well, see if the president mentions anything about ocean shipments and references actions by the Department of Justice, the Maritime Commission, directed at ocean shippers.

“That may not be something that people would normally think about,” Vilsack continued. “But given the fact that we’ve had so much difficulty in terms of getting things to and from the United States, that has exacerbated the supply chain challenges that often result in higher costs.”

President Biden’s address is slated for 9 p.m. Eastern on Tuesday.

To hear the complete discussion between Secretary Vilsack and Flory on AgriTalk, listen here:

Hear It Here First: Vilsack Shares Details on Important ‘First Step’ for Infrastructure Bill

Wed, 11 Aug 2021 14:47:04 GMT

USDA Secretary Tom Vilsack joined AgriTalk host Chip Flory on Tuesday to celebrate what he described as an important first step in the process of improving infrastructure in rural America and across the country.

With bipartisan support, the Democratic-controlled Senate passed an infrastructure bill.

“A multitude of administrations have talked about the importance of investing in infrastructure but have not yet been able to get the job totally, completely done. The fact that this administration, working with this Senate, in a bipartisan way, was able to get 69 senators, 19 Republicans and 50 Democrats, to agree on a fairly significant package that will improve broadband access, invest in a modernized transportation system, ensure peace of mind when you turn on the tap with clean water and safe drinking water and invest in more resiliency on our farms and forests, it’s a big, big day,” Vilsack said. “It’s obviously a first step, the House has to has to take action. But I think we clearly see there is an understanding and appreciation that the time is long overdue for these investments.”

Flory: How do the items in the infrastructure plan help with the economic competitiveness for U.S. agriculture?

Vilsack: “When you build better roads, when you improve and make safe bridges, when you make sure the rail system works in an efficient way, when you improve inland waterways so lock and dam systems work in a modern way and you improve ports, it means you’re able to move soybeans, corn, whatever the commodity more efficiently, more effectively and less expensively to market. That allows you to price a product in a way that is very competitive in the world market. When 20% to 30% of everything we grow is exported, the transportation system is critically important to the ability to maintain our edge and ag exports. We’re headed toward a record year in agricultural exports. If we don’t invest, if we continue to delay these investments as we have over the last decade, our competitors will catch up and eventually surpass us and we’ll lose that competitive edge.”

Flory: Some farmers are going to take a look at the infrastructure bill and say the $65 billion to rebuild the electric grid is unbelievably necessary, but then they’ll see $7.5 billion to build a national network of charging infrastructure for electric vehicles and they would like to see that money spent on ethanol instead.

Vilsack: “The reality is there’s also research dollars, there’s also an effort to expand access to aviation biofuels that this forthcoming in legislation. There is going to be plenty of support, plenty of need, more importantly, for the biofuels industry. You continue to see that support. But the reality is, there is a companion opportunity, and there are multitudes of ways to generate that power and electricity for those vehicles, some which involves biomass. It’s really just simply moving away from a reliance on fossil fuels to a more significant opportunity for farms across the board here. Then when you add that to the investments in climate-smart agriculture that are in this infrastructure bill, and the reconciliation bill may be considered, you’re talking about a probably historic investment in American agriculture we haven’t seen for quite some time.”

Flory: In terms of high-speed internet, what does the bill include that is going to make it a reality for rural America?

Vilsack: “A significant percentage of the $65 billion will go to the Department of Congress and others and USDA to invest in rural broadband. This is about remote areas. This is about areas that don’t have high speed. This is about making sure that every American has access. What does that mean? It means farmers and ranchers will be able to have the benefits of precision agriculture because they’ll be connected. They’ll have the benefits of understanding markets in real time so they can maximize their return. Their families will have the benefit of telemedicine and distance learning. Small businesses in rural communities will have an opportunity to expand markets beyond the county and beyond the region to the rest of the world. This is a really big deal. It’s long overdue. And frankly, we’ve been nickel and diming this infrastructure for far too long. Now resources will go to states. States can put them to work very quickly, and people can get connected, which is, I think, one of the reasons why this bill is so important and probably one of the reasons why it got such broad bipartisan support.”

Flory: When do you think we might get some of the details of the plan to build up the high-speed internet for rural America?

Vilsack: “The way this works is the House has to pass, hopefully they pass in the same version, but they may make a tweak here or there, so it goes back to the Senate. Eventually it gets hopefully passed, signed by the president and then the resources are provided to the departments and then they have to write the rules and regulations for how those resources will be distributed. Many of those rules and regulations are already written. Some of it will go through grants directly to states and then the state governors and state legislatures were appropriate those resources consistent with what works best for them. Some of it will go to USDA with its reconnect program where it will work directly with a rural electric cooperative or a telecom company for investing in grants and loans that will allow them to do the infrastructure and the investment and installation of the technology necessary to expand access and what this means. We’ve talked about what it means to farmers and families, but it also means jobs, I mean, a lot of rural jobs. You can’t improve broadband and fix road, bridges, ports and inland waterways without putting a whole lot of people to work. A lot of those folks are going to be working from small communities across the country. This is a real boost potentially for the rural economy.”

Flory: It’s a huge package, $1.2 trillion, $550 billion in new spending over the next five years. It’s an awesome investment, of course, but there is concern about how it’s going to be paid for. What’s the status of the tax plans and specifically the estate taxes and the step up in basis?

Vilsack: “Well, that’s not impacted affected by this bill at all. I have a lot of respect for Senator Portman from Ohio. He’s one of the fellows who was part of the bipartisan group who put this bill together. He’s a conservative Republican. He’s confident it’s paid for. It’s paid for in a variety of ways. There are some fees involved. There are people who aren’t paying the taxes they owe. I think there will be stronger enforcement to make sure folks are paying what they in fact owe. No changing the tax law, just simply paying what you owe. There’s obviously going to be growth in the economy when you put this kind of work together and that growth is going to generate additional revenue for the government as well. Senator Portman is confident and so were the 69 senators who voted for this that it’s paid for. There may be some folks who disagree with that, but at the end of the day, there’s no disagreement about the necessity for America to really get serious about infrastructure investment.”

Flory: What does the effort look like now to encourage House Speaker Pelosi to bring the bill to the floor of the House?

Vilsack: “Well, I think she understands and appreciates that if you really, really want to make America competitive and take advantage of this once-in-a generation opportunity, you also have to invest in strengthening American families because that’s part of the infrastructure, if you will, of the country. I think she wants to see action on the part of the Senate. I think Senator Schumer is actually working on that as we speak. I think once the Speaker is convinced there’s going to be action on both sides, both a physical infrastructure and the family infrastructure, then I think she’ll be a more comfortable position to be able to go to her Caucus and say this is something we need to get behind, this is something we need to get done. The jobs, the impact on education, the impact on access to healthcare in rural places, the ability to be competitive and export, clean drinking water for millions of American families — it’s pretty hard to say no to a bill like this. We’ve been frankly saying no for a long time; this is a major step forward. Hopefully we take full advantage of the momentum that this bipartisan group of senators created and the president created.”

Listen to the full AgriTalk segment below.

'We've Struck a Deal': Biden Announces Agreement on Bipartisan Infrastructure Spending Plan

Tue, 13 Jul 2021 20:34:00 GMT

After months of negotiations and disagreement, President Joe Biden and the White House announced a deal was reached on an infrastructure spending plan. The news came after a meeting with a bipartisan group of senators Thursday.

“We have a deal,” Biden told reporters at the White House after meeting with the group. The announcement was also posted on the President’s official Twitter page.

We’ve struck a deal. A group of senators – five Democrats and five Republicans – has come together and forged an infrastructure agreement that will create millions of American jobs.
— President Biden (@POTUS) June 24, 2021

While details of the deal weren’t outlined, the agreements was reached as senators,known as “Group of 21", visited the White House seeking a bipartisan agreement on an infrastructure bill. The pared down plan is worth $953 billion, with $579 billion in new investments for roads, broadband internet, electric utilities and more.

Reports before the Thursday meeting indicated the G-21 group was focused on reaching an agreement on a $1.2 trillion infrastructure plan, which would be funded with a mix of new funding, as well as money left over from previous COVID relief bills. Report show the package also included $559 billion in new spending.

Just prior to that meeting, Reuters reported one top Republican was still undecided as he headed to the White House for the meeting. Senator Mitch McConnell (R-KY) hadn’t voiced his support or opposition to the proposal yet.

“He remains open-minded and he’s listening,” Senator Rob Portman, a leading Republican member of the G-21, told reporters after meeting with McConnell. “He hasn’t made his decision.”

Check back for more details of the bipartisan spending plan.